Prior to the housing bust, destinations such as South Florida, Las Vegas and Los Angeles stood out among U.
S.
cities as American hot spots, supporting what some saw as a "gold rush" in housing and causing prices in these metropolitan areas to explode.
But when the bubble popped in these high demand cities, these double digit gains were quickly erased and values tumbled, losing more than 50% from their peak in some areas.
According to Zillow.
com, the trend may continue well into 2012.
Focusing on South Florida, the real estate website stated that home values in the area fell nearly 13 percent in the first three months of this year, compared to the same period last year.
Nationally, home values fell on average 8.
2 percent from a year ago.
Zillow estimates that considering the pace of price declines nationally, the housing market will probably not hit bottom later this year, rather 2012 at the earliest.
As for South Florida, the website says the area will not begin to bottom out until sometime after the national market hits bottom.
However, it is the decline in home prices that is enticing foreign buyers and investors to search for real estate within these hardest hit areas.
Coupled with a declining dollar which allows foreign money to go a lot further, the housing market is seeing an increasing support from foreign buyers around the world, from South America to Europe.
For the 12 months ending in March, 31% of Florida's home sales were to foreign buyers, up from 10% in 2007, according to a survey by the National Association of Realtors From vacation homes to investment properties such as condos to rent, this support could prove vital to the South Florida area and U.
S.
home sales.
California is also seeing a jump from foreign investments.
Trulia, the online real estate information service, reports a big jump in searches for Silicon Valley real estate from other countries.
Searches for property in Cupertino were up 90 percent in the first quarter of this year from a year earlier, Trulia reported.
Palo Alto was up 121 percent; Los Altos Hills up 182 percent; Atherton up 68 percent and San Jose up 86 percent.
It will be some time before we see what effect this will have on the battered market, particularly in South Florida where home prices continue to fall despite brisk sales.
But for now, these areas are welcoming the much needed lift in home sales and offering a little hope that the bottom is coming soon.