Virginia’s property market is bitten by the credit crunch. Home values have tumbled from an impressive run in the previous years that was brought about by the real estate boom. Foreclosures are also on the rise that has consistently hammered home prices.

Virginia’s economy also experienced a severe stalling after its Fortune 500 companies were caught by the crisis. Technology and manufacturing jobs were slashed to contain the fall in quarterly profits. Tourism-related businesses were also affected by the weak travel statistics. The only industries that are holding on are education and health-services that added more than a thousand jobs last year.

Alexandria’s economy is branched out from the nearby influences of Washington, D.C. But the slowdown in the national economy has debilitated the local market and retarded its growth. Consumer confidence remains bearish due to the weakening of the real estate sector. Since home values have fallen considerably, only a few are interested in taking the risk of home ownership.

Alexandria’s home purchases are taking the wind out of the city’s real estate’s sails. The high inventory of homes remains a consistent problem among owners whose properties’ values are dragged down. Still, not all can afford single-family homes that can be purchased at an average of $600,000. This year, prices will fall further by 13.5 percent.

Roanoke is a healthcare and retail destination for businesses. These industries should prevail despite the heaving of the financial crisis. In its property scene, the Star City is taking a softer plunge since the local economy’s downturn happened earlier compared to other cities. Home prices will fall by 12.5 percent due to the drag in home sales.

Richmond will be one of the hardest battered property markets in the state. Subprime mortgages have found their way to the market’s detriment as they are scheduled to reset this year. Lenders have also tightened their rules, making home ownership bleaker for first-time buyers.

The state’s capital experienced massive job losses in the past year with particular contraction in the manufacturing and construction industries. Laid off homeowners will have higher risks of losing their homes in the area. RealtyOutlook.com forecasts a 14.5 percent loss of value among the homes in this banking hub.

Virginia Beach is no more than a real estate catastrophe. After the tourism industry failed to post the same impressive numbers in 2004, the local economy is getting a hard time to pick itself up from the mess. Home sales have not improved for the past few quarters and brokers are starting to shift careers due to a lingering weak buyer confidence. RealtyOutlook.com forecasts a 12 percent reduction in the city’s home values.

Arlington had a good year when its economy posted only fewer slumps unlike other cities. Residents are benefitting from the revenues provided by education institutions like Marymount University, George Mason University and DeVry University, and business services located in Crystal City, Rosslyn and Courthouse.

Its property market will be in a terrible situation this year however. RealtyOutlook.com projects a 13 percent drop in home values with the hardest hits taking place in Crystal City, Lyon Village, Palisades and Fairlington. Weak home sales are also expected in Barcroft, Madison Manor and Yorktown.

Norfolk’s work force is slowly diminishing after businesses suffered deteriorating balance sheets. Unemployment last December stood at a 16-year high with the impact felt in the shipbuilding and home building fields. The area also experienced a peak in its home sales during the real estate boom only to become sluggish last year. RealtyOutlook.com expects home prices to fall by 12.5 percent.