Clear Capital forecasts drop in home prices in 2011

Though some real estate markets have begun to recover from the economic recession, others are expected to see further negative effects, including decreases in home prices in 2011, according to Clear Capital.

"Understanding which path a given market is likely to follow is dependent on several key factors, but the two clear drivers are local unemployment rates and the prevalence of distressed homes," said the company's senior statistician, Dr. Alex Villacorta.

Taking these two factors into account, the company forecasted price changes they expect to occur in the country's 50 largest real estate markets. Those interested in moving to a city where they can take advantage of the recession by finding low home prices may want to avoid Washington, D.C. The city's real estate prices are expected to increase by 6.5 percent. Clear Capital also expects rates to increase in Houston and Honolulu by 3.6 and 3.4 percent, respectively.

However, those moving next year can still find good deals in Virginia Beach, where Clear Capital projects a 12.8 percent price decrease. Other projected affordable markets include New Haven, Connecticut and Tucson, Arizona, where prices are expected to go down by 11.9 percent. 

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