Foreclosure Homes in Alabama

It is true that Alabama has not suffered as badly as many States across the country, but that is of little consolation to those who have had their homes repossessed in the last months. The figures are up on the preceding month by 15%, but more dramatically by 233% on the year before. This sounds incredible but it is still way less than the seriously affected states like Nevada, Ohio, California and Florida.

As the nation’s crippling housing crisis seems to drag on indefinitely, for at least two years in some cases now, Alabama is again fortunate that in comparison to many other States, there are less homeowners who are living with negative equity; that is a situation where they owe more on their mortgage than the property is worth. In the world of Real Estate, this situation is referred to as being ‘underwater’, and is closely tied to the foreclosure crisis.

In Alabama there are around 17, 713 ‘underwater’ properties, which amounts to about 7%, a lot less than the 48% that is quote in Nevada, but still significant. The Birmingham city metropolitan area has not truly reflected the national trends, and this is thought to be as a result of the more cautious and conservative history of the people living in the area. Cities like Las Vegas are the complete opposite.

Many of the problem properties are on coastal or water front locations where the price surges and drops are more serious. The inland stability has shone through in this turbulent period. It is hoped that if unemployment continues to rise, this trend will be reversed at least lending some hope to overstretched residents.

Unemployment figures are lower than the national average with Alabama rating at 5.,4% compared to the nation 6.5%. Companies in the Birmingham area are still reported large scale downturns in profits though. Recently three of the States largest auto manufacturers, Honda, Hyundai and Mercedes announced huge drops in profits, and it is only a matter of time before this translates into job losses. Job losses means more people defaulting on mortgage payments and more foreclosures.

The future is not too bright either, with experts predicting that unemployment will continue to rise and may hit 5.9% by the end of March 2009, and despite several expensive government initiatives the number of homes being repossessed and entering the lengthy foreclosure process continues to rise. As the festive season approaches many Alabama residents will not be too focussed on what Santa is bringing, more on whether Santa will have a home to come to.