TAMPA - Aaron Jacobs' home search spanned a year and involved exhaustive research, dozens of tours and a lot of second-guessing.

"We did a lot of looking into whether the market would improve, whether prices would continue to drop," he said. "We finally determined that the bottom line is you really can't tell. It's a gamble."

Jacobs and his girlfriend recently gave up their quest to time the market, snapped up their first-time buyer federal tax credit and bought a home in Carrollwood.

They join thousands of others who are driving up Bay area home sales, contributing to signs that the worst real estate slump since the Great Depression is turning a corner. No doubt 2009 was a tough year for the economy, and real estate in particular. Potential homebuyers and economists are trying to gauge what the market will do this year.

Experts agree that 2010 will be hard on some fronts, namely unemployment. But positive signs are mounting for real estate, and many expect a slow recovery, with more improvement later this year.

"Homes are finally affordable for the average Floridian using a traditional mortgage," said Mike Larson, a real estate analyst at Weiss Research. "We're going to continue to see normalization in stages."

The median sales price of existing homes in the Tampa-St. Petersburg-Clearwater metro area hit $139,100 in November. Compare that with $239,600 in June 2006, when local home prices peaked. The expensive home prices played a leading role in the housing downturn.

"Homes were overpriced, and buyers had to take out stupid loans to afford payments," Larson said.

Buyers stretched their budgets with creative financing, such as adjustable-rate mortgages that ballooned just as home prices plummeted and many lost their jobs. Falling prices led to rising foreclosures, which pushed down prices further.

Not out of the woods

Late last year, the Bay area started to show signs of market stabilization. Sales prices rose or fell slightly for several consecutive months. The number of home sales increased as buyers took advantage of federal tax credits. Foreclosures decreased as more troubled homeowners worked out loan modifications.

Much of the improvement isn't sustainable, though, said Chris Lafakis, an economist with Moody's Economy.com.

Price declines slowed in the Bay area as the inventory of homes for sale decreased, he said. Much of that was due to homes in foreclosure coming off the market.

But many of the homeowners with modified loans won't be able to keep up their end of the bargain, Lafakis said, and will likely end up back in foreclosure. When those homes sell at fire-sale prices, they will push home prices down again, he said.

Lafakis expects Tampa area foreclosures to increase during the first half of 2010, as unemployment rises. The U.S. Bureau of Labor Statistics estimates the Tampa metro area had an unemployment rate of 12.3 percent in November. Moody's projects the rate will peak at 13.6 percent during the third quarter of 2010.

When people are losing jobs, or fear they will lose jobs, they're much less likely to buy a home, Larson said.

Sean Snaith, an economics professor at the University of Central Florida, doesn't think home prices have hit bottom, but doesn't think they will fall dramatically, either.

"Prices will continue to bounce around a bit and will remain soft at best," he said.

Even though that may add to the heartache of home sellers, it isn't bad news, said Mark Vitner, a senior economist with Wells Fargo.

Projections for this year aren't strong, but the nation and the Bay area will recover, he said, although slowly.

"I don't think the housing market will return to a level people will think is strong until 2012," Vitner said.

Even though home sales are increasing, he said, a bulk of those sales are distressed homes bought by investors.

"One of the things troubling me is the amount of vacant homes for rent," Vitner said. "The number of those homes seems to be increasing faster than the number of vacant homes for sale is falling."

Tax credit's effect

Many of those homes are staying vacant. What that means, Vitner said, is that the oversupply of housing isn't going away as quickly as some think.

The federal tax credit for first-time buyers was a boost to the housing market. Buyers rushed to purchase before it was set to expire in November. The tax credit was extended to April and expanded to include some existing homeowners.

Real estate agents say demand had fallen as the tax credit was about to expire, and has increased again. That's led some economists to question what will happen when the incentive expires this spring.

What the real estate market needs, the experts agree, is for more people to buy homes - but only if they're able to keep them.

Jacobs, the first-time homebuyer, said he's glad he took the gamble - even though his home has lost value in the short term. He often checks home sales online and said his house is estimated to be worth about $10,000 less than he paid in November.

So he has decided to stop checking values - and no more second-guessing.

"I can afford what I have, and I'm happy with that," Jacobs said. "If the market continues to plummet, it does. We're there for the long haul."

Reporter Shannon Behnken can be reached at (813) 259-7804