The prospects of selling a home in Alabama will continue to be in a slump this year although the financial crisis may still leave some cities resisting against its adverse impacts.

Birmingham’s banking and insurance industries were badly hit by the economic downturn. It was the exact opposite of the city’s business climate two years ago where large and small banks thrived during the boom in the housing market. Now, even IT and medical industries are cutting their workforces.

Since the area has experienced the blow of the crisis during the second half of last year, it would definitely have a more dismal property market this time. And as unemployment is likely to swell even further for Birmingham, home sales will also suffer. RealtyOutlook.com predicts home values to deflate by 12.5 percent.

Dothan may have one of the cheapest costs of living in the country but it had more job losses in 2008. That would mean a large loss in potential home sales. Also, foreclosures are taking a peak as lay offs spread in retail and manufacturing industries. This year, home values will fall by 10 percent.

Mobile relied heavily on its shipbuilding and manufacturing sectors during the 90’s but economic activity remains sparse today. High-end vacation houses posted slack sales along with other luxury estates last year. While home prices are down compared two years ago, qualifying for a mortgage isn’t easy at all. Loan providers are now too tight with their approvals often requiring higher credit scores than usual. When the Louisiana migrants who settled after Hurricane Katrina devastated their homes, Mobile has further sunk in the downturn. Expect prices to go down by 2.5 percent.

Tuscaloosa’s recent growth in retail and manufacturing cannot keep up with the significant drop in home sales. It must rely on its recession-proof healthcare industry during the year. Home values will dip by 9.5 percent in 2009.

The Huntsville property market has also turned sluggish and would remain so this year. Expect a 6.5 percent fall in home prices that will likely remain flat in the third quarter. Nevertheless, most of its businesses will withstand the crisis mainly because of the aerospace hubs and military centers that attract tourists all throughout the year. Adding support are the IT and telecommunications firms in the Huntsville-Decatur area.

Montgomery has experienced the brunt of subprime mortgages last year. High default rates of borrowers wore out the credit market. To make matters worse, housing values remain very low and are to continue falling down by 11 percent this year.

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