Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

6 of 7
BACKNEXT
Oakland, Calif.
Median home price: $318,000
Value lost since 2006: 48.1%
Forecast gain by 2011*: 0.4%

Looming over Oakland's metro area is the exotic mortgage, such as option ARMs, which will start to reset to higher rates over the next few months. It's feared that could fuel another severe wave of foreclosures.

Still, the foreclosure problem of Oakland pales in comparison with those of inland California cities. Plus, the city also has a lot going for it, including many communities that are "highly sought after by homebuyers," according to Mark Fleming, chief economist for First American CoreLogic. That should buoy home prices once the economy recovers.

Before that happens, Oakland will have to work through some significant economic problems. Unemployment, at 10.7% in the metro area, exceeds the national average, although it pales in comparison to some of the inland California metro areas. Yuba City, for example, has hit 16.1%, and El Centro is at a whopping 28.7%.

With the prospect of continued job losses, it's no surprise that Fiserv is predicting an 11.7% drop in home prices by June 2010. After that, however, Fiserv expects Oakland to take off again thanks to its strong and varied businesses, such as health insurer Kaiser Permanente, Clorox and retailer Dreyer's.

Its position across the Bay from San Francisco and its great educational institutions, led by the University of California, provide a further base for the economy. Fiserv forecasts that home prices will return to double digit growth starting next June and produce gains of 13.7% in the following year. Averaging out the drop and the gain, Fiserv expects a 0.4% rise over the next two years*.

NEXT: Birmingham, Ala.

Last updated October 21 2009: 4:51 AM ET
Email | Print | Share  |  RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
Source: Fiserv
* From June 30, 2009, through June 30, 2011.
More Galleries
Best-loved new cars of 2016 These cars are the most beloved among American drivers based on JD Power's annual survey of new vehicle buyers. More
This Indian university cranks out top-tier tech execs Many graduates from the Indian Institute of Technology have gone on to start and lead global tech companies. Here are a few of the most notable alums. More
Most valuable American car up for auction Carroll Shelby's own very first Shelby Cobra will be sold in August. It's almost certain to be the most valuable American car ever sold. More

Special Offer