A number of factors have led the real estate market to end 2010 with numbers that are way below its starting point, including the cancellation of federal taxes, seasonal buying as people try to beat the federal tax cancellations, and low buyer confidence as some lose jobs [1]. Not only are home sales down, even home values are. Yet New England went against the national trend – though it doesn’t necessarily mean that the region is headed to better things for 2011.

Whereas S&P/Case-Shiller Home Price Indices reports declines in home prices during the third quarter of 2010, New England registered an upward trend. Even in Rhode Island, where unemployment rate was highest in the region (11.6% – also fifth in the nation), average prices shot up for single-family homes, condominiums, and even multi-family. From $243,968 in 2009, single-family homes went up 11.2% to $271,244 in 2010; even condominium prices cashed in a 10.1% increase. Multi-family homes saw the biggest increase at 20.4% from 2009’s $114,131 to 2010’s $137,451.

The increase in home prices though does not mean New England was clear of the pains of the real estate market crash. It was not spared the drop in home sales as it registered a decrease across all boards. Single family home sales had a 5.0% average drop, condominiums -2.8%, and multi-family homes -9.7%.

As more Americans also become underwater on mortgages, foreclosure activities are expected to increase – same as in New England. RE/MAX New England’s Executive Vice President and Regional Director Jay Hummer notes, “More foreclosures in the market will absolutely affect the timeline to an industry recovery. Purchasing a foreclosed property also takes anywhere from six to 12 months and even with conservative estimates, we won’t see a turnaround until at least 2013. That’s why it is so critical that investors ramp up activity now.”

[1]http://www.businesswire.com/news/home/20110110006434/en/2011-Housing-Market-Stable-Pricing-Increased-Mortgage