It's no secret that the U.S. real estate market remains in the doldrums. The majority of market experts see a recovery on the horizon, but that horizon remains a number of years off. For the past couple of years, the recovery period was seemingly extended by a year or more once tangible signs of a turnaround failed to materialize.

"Guesstimates" these days peg 2014 as the year when demand and supply imbalances will start to return to more historical norms. And as any value investor will tell you, the markets that were hardest hit during the dramatic bursting of the bubble are ripe for more significant turnarounds. (To learn more, see Market Crashes: The Housing Bubble And Credit Crisis.)

Here are five markets to watch in the coming year. Given that they were among the hardest hit, they could see quicker recoveries that also build steam in the next couple of years. They share some positive characteristics, including sunny locales that retirees find popular, and all were benefiting from a general population migration to warmer climates from colder ones in the northern parts of the country.

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1. Las Vegas

Las Vegas was one of the worst-hit markets in the country. Its vicinity to California is partly to blame, as deep-pocketed investors migrated to its housing market that is much more affordable than across Nevada's western border. The city also has a reputation for get-rich-quick speculators given its locale as an international gambling destination. An overdependence on cyclical gambling and tourism also has not helped matters.

These and other factors, including an unemployment rate that hit 15% recently, have given Las Vegas the dubious distinction as having one of the worst local economies in the world. However, the conditions that encouraged the housing bubble and crash are ones that should bring a recovery. For one, the desert climate is very appealing to retirees, as is a very low cost of living as many casinos cater to retired locals. Real estate is now very affordable, both in absolute terms (a small house can be found for under $100,000) and also in comparison to California. Finally, tourism will inevitably recover, and the airport will soon unveil a new terminal that will bring in needed international flights.

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2. Phoenix

Phoenix is very similar to Las Vegas, but without the gambling exposure. The desert climate, as well as cheap and widely available land for housing expansion, encouraged speculators to rush in, along with retirees and others looking to get out of colder snowbelt states. An abundance of golf courses and upscale locales, such as Scottsdale, were also big draws. Vicinity to California has also been cited.

Phoenix remains a top destination for business relocations and has picked up population for decades. The bubble burst slowed this migration, but the long-term trends continue to support cities, such as Phoenix, outgrowing most other parts of the U.S. Some of the cheapest homes in the country should eventually turn the taps back on to a return of population growth. (For more, see 7 Cities With Great Real Estate Deals.)

3. Fort Myers

Fort Myers is noted for its sunny disposition. But it gains appeal, versus desert locations, from being next to the Gulf of Mexico and having miles of beautiful coastline. Unfortunately, its housing market also got caught up in a speculative frenzy, which is attributed to its middle-class focus and the initial affordability of its residential real estate compared to other parts of Florida.

Things deteriorated so badly that the area was considered "ground zero" for the bursting of the housing bubble, but that is exactly what makes it a prime candidate for a recovery. Affordability is again the key, with the median house now going for a bargain-basement $115,000. Vicinity to Naples, Cape Coral, Fort Myers Beach and Sanibel Island are other selling points.

4. Miami

The Miami market experienced a bubble and subsequent bust primarily in the condominium market. Its market headed south rather quickly as some estimates pegged 70% of the real estate market had become flooded with speculators that were only interested in a quick flip of property. Miami was a boom town that hit a major downturn and is still waiting to recover.

The push to condominiums speaks to the fact that land isn't as widely available in the area. This has helped preserve residential housing prices somewhat, and the fact that Miami is a major market for South American trade means it will remain a desirable destination. It is also a favorite getaway for New Yorkers, and overall, it has appeal as one of the warmer destinations in the country.

5. Santa Barbara

Much like most of California, Santa Barbara remains an expensive housing market. But it did have a housing bust of its own. Similar dynamics drive Santa Barbara's appeal as a housing market. Beautiful beaches and great weather are selling points, as are a handful of wineries and vicinity to mountains. The area is also not that far outside of Los Angeles, which means there is a large market that can drive a recovery at some future point.

The Bottom Line

Due to the dramatic declines since the housing bubble, the above cities, excluding Santa Barbara, have some of the most affordable houses in the country. The average house price in the U.S. has fallen to just over $178,000; but Vegas, Phoenix, Fort Myers and Miami offer many properties below $150,000. Santa Barbara is still very expensive but fair when compared to the pricey California market overall. (To learn more, check out Cities Where Home Prices Continue To Fall.)

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