Rising sales
Despite falling prices, there were some hopeful signs in the data.

Home sales increased dramatically in some markets during the first quarter, especially in states where foreclosures are pervasive and prices have declined most sharply during the housing downturn.

Overall, six states recorded year over year sales increases in the first three months of 2009. Nevada saw a whopping 116.8 percent surge in transactions. Other gainers were California (80.6 percent), Arizona (50.2 percent), Florida (25 percent), Virginia (12.2 percent) and Minnesota (11.9 percent).

Increasing affordability helped pull first-time homebuyers off the sidelines and into the market in those states, according to the NAR, which said first-time homebuyers accounted for half of all U.S. home sales during the first quarter.

First-quarter sales do not yet reflect the potential sales impact of the federal government's new $8,000 tax credit for first-time homebuyers, according to the NAR.

In a prepared statement, Lawrence Yun, NAR chief economist, said contract activity and buyer traffic have increased over the past couple of months, a trend he expects will continue.

"Housing affordability conditions are at record high levels and we expect a measurable increase in home sales during the second half of the year, which would help stabilize prices in most areas," Yun said.

How did home values fare in your area? See our state-by-state map.