Home prices expected to stabilize

The housing market is becoming more affordable as prices continue to drop, according to Fiserv. Home prices dropped 4.1 percent in the fourth quarter of 2010 and their affordability is now close to pre-bubble levels across the country, according to the Federal Housing Finance Agency.

"The first step toward restoring confidence in housing markets is an improvement in consumer sentiment, which we expect will increase slowly through 2011 due to stronger job gains and a falling unemployment rate," said David Stiff, chief economist, at Fiserv. "As confidence rises, the decline in home sales that started in 2006 will, finally, come to an end."

As the economy continues to improve and more people may be looking to relocate for a job, or move into a better neighborhood that is now affordable, according to Zillow.com. Prices fell in more than half of U.S. metro areas and are expected to drop another 3 percent this year.

Experts believe that the housing market will level out in even the hardest hit areas by 2012, according to the news source. However, the process will be uneven across the country, because it is widely based on job growth.  

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