In December of 2009 we had the most significant drop in home sales in more than 40 years, but to end 2009 we had the first annual gain in four years. The reducing in the median home value of about $175 had a lot to do with it and the primary culprit to that end was the foreclosure market.

If not for the REO’s and Short Sales this past year, home sales could have been drastically reduced and the economy would have suffered even more than it has. Total sales for 2009 were almost 5.2 million, which was up from 2008 by about 5%.

In March the Federal Reserve is expected to end its program of buying mortgage securities and the extended homebuyer tax credit is expected to end in April. These two factors could have a significant effect on the housing market and could weaken it even further, but stay tuned to our post because I believe the government will extend one or two of these programs.

Unfortunately foreclosure will continue to rise and homeowners need to know their options – Homeowners need to have a place to turn and they need to know that there are options to foreclosure. National Foreclosure Prevention Service offers free confidential consultations; even if we are unable to help at least we can give honest advice to the homeowner about the different options available to them.

It is also clear that the number of people being helped in this recessionary time have been those who are able to take advantage of the many government programs. The tax credit that was sent to expire in November was extended by Congress to allow up to $8,000 for first-time homeowners and a new $6,500 credit for existing homeowners who move.

It remains unknown what will happen when these government programs come to an end before the economy can start to show significant sustainable grown on its own because as most analyst will agree, a healthy real estate market is needed to help the economy continue recovering from recession.

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