Memphis downtown skyline w/ trees and Wolf Rover and boats and harbor in the foreground.

While much of the country has bounced back from the housing crash, Memphis and other smaller markets are having a harder time. (Getty Images)

For much of the U.S., the housing market crash and Great Recession are a recent reminder of the worst-case scenario when lending and homeownership are approached cavalierly. But these events have also become a piece of history, as home prices and homebuying rates have largely climbed above pre-recession levels.

But in some parts of the country, residents are still waiting for that bounce back from the recession – and it may never come in the way people hope. The number of homeowners currently underwater – owing more on their mortgage than the property’s value – is low nationally at 5.1 million properties, or 9.3 percent of mortgaged properties in the U.S., as of the second quarter of 2018, according to real estate information company ATTOM Data Solutions.

Concentrated portions of the U.S. carry the bulk of that load, however, with some metro areas seeing more than 1 in 5 homes underwater and more than half of properties underwater in specific ZIP codes, per ATTOM information.

[Read: 5 Reasons to Hold Off on Buying a Home Now.]

ATTOM Data Solutions examined 97 metro areas throughout the U.S. in its recent report on seriously underwater properties in which the homeowner owes at least 125 percent of the home’s value. While it’s hard to pinpoint a normal share of the market that's underwater, Daren Blomquist, senior vice president of communications for ATTOM, says a fairly healthy market should have “around 5 percent or even less of homes that are seriously underwater.”

The following four metro areas stood out with high rates of seriously underwater properties:

Memphis, Tennessee: 20.5 percent
Youngstown, Ohio: 19.5 percent
Scranton, Pennsylvania: 19.5 percent
Toledo, Ohio: 18.9 percent

The only metro area with a higher share of seriously underwater properties is Baton Rouge, Louisiana, at 20.8 percent, where the housing market is still suffering from the effects of historic flooding in August 2016. The natural disaster is more the cause of housing market woes than any economic factors, Blomquist says.

But for Memphis, Youngstown, Scranton and Toledo, Blomquist explains they fall “into the category of cities that were struggling before the recession in some ways and are continuing to struggle.” In the U.S. Department of Housing and Urban Development's comprehensive market analysis for the Youngstown metro area, nonfarm payrolls were not only still below pre-recession levels at the time the report was published in 2016, but they were also as much as 12 percent below the historic peak, which occurred in 2000.

How Did We Get Here?

Unemployment rates for Memphis, Youngstown and Scranton, in particular, linger primarily above the national average going as far back as 2003, according to the U.S. Bureau of Labor Statistics, including during the recession when national unemployment rates reached above 9 percent during the recession.

Without an increase in available jobs, fewer homebuyers are on the market and many others could leave the area, leading to relatively stagnant home value growth. On top of that, when homeowners face loss of income due to layoffs or little to no increase in income for several years, paying off their mortgage becomes harder.

[See: The 25 Best Affordable Places to Live in the U.S.]

It’s not just a matter of some markets lagging behind others. Many parts of the Rust Belt and rural U.S. continue to have floundering housing markets, while larger, more populous metro areas benefit from continued population growth. In a recent study by real estate information site Trulia, non-metro areas saw a decrease in population of about 1 percent between 2012 and 2017, while home value appreciation for the same areas increased 27.9 percent over the same period. Compare that to a metro area like Phoenix, which saw its population grow by 9.6 percent and home values appreciate by 75.3 percent during the same time frame.

“The reason people are leaving the rural areas is because the jobs have been created in the metro areas,” says Felipe Chacón, housing economist for Trulia.

Rural parts of the U.S. have traditionally based their economies around agriculture and manufacturing, two industries that have been disrupted significantly through automation. “Farms [and factories] can increasingly be managed by fewer and fewer people,” Chacón says.

Automation isn’t a post-recession anomaly, and both smaller metros tied to more agricultural and manufacturing industries and the non-metro rural areas themselves have been feeling the economic pain for longer than that. As job opportunities decrease in the rural sectors, employment continues to rise in tech and other industries that thrive in urban and suburban settings.

“Those are areas where they were struggling before the recession, and when the recession hit … because of the situation they were already in, it’s been tougher to bounce back,” Blomquist says.

When Will Recovery Happen?

The fact that home values in non-metro markets have been able to recover, if in a small way compared to major metro areas, is a sign that rural markets aren’t dead or dying – they’re just adjusting to a new reality. In a comprehensive market analysis published in 2016, HUD notes economic and housing market growth has occurred in the Memphis market, even if that growth hasn't reached the level of the rest of Tennessee.

Chacón doesn’t expect the population or job market in rural areas to necessarily return to previous high points but instead stabilize as smaller markets than they once were. The areas that manage to maintain employment diversity with county or local government jobs, rural health care and teaching, among others, will “keep population better than other areas and will be able to sort of sustain themselves,” he says.

In HUD's market analysis for the Toledo metro area, for example, which was published in 2014, farming and manufacturing jobs were still at a net loss since 2000, though education, health care, hospitality, leisure and other services managed to increase in employment opportunities over the same time period.

This could also be the case for the metro areas with high rates of underwater properties, like Scranton or Youngstown, which may need to restabilize as a different, smaller market. Though, that doesn’t necessarily mean it’ll be easy for homeowners currently underwater to gain equity back in their homes as demand for properties continues to decline.

To be able to make a comeback in terms of home values, Blomquist says markets and ZIP codes with long-standing high levels of seriously underwater properties can’t expect a quick return to better economic times. An exception could occur with a sudden change or major employer entering the city, like Amazon HQ2, though none of the cities on ATTOM’s list made it to Amazon’s short list.

[Read: Do You Live in a Food Desert?]

It’s impossible to tell which metro areas or towns will see a renaissance through major employer relocations and subsequent population growth and which will continue to shrink until it reaches an even point.

“An influx of jobs could change things more quickly, but for now most of these cities are on the long path for recovery – slowly,” Blomquist says.

The 25 Best Places to Find a Job in the U.S. in 2019

Looking for a new work-related adventure?

Top view of multiracial young creative people in modern office. Group of young business people are working together with laptop, tablet, smart phone, notebook. Successful hipster team in coworking. Freelancers.

(Getty Images)

When you’re considering moving to a new place, how you plan to make money matters a lot. A flourishing job market can easily mean the difference between making it and flaming out in a new town. This is why in the overall ranking of the Best Places to Live, each metro area’s job market – comprised of its unemployment rate and median salary – accounted for 20% of the final score. Read on for the 25 strongest job markets in our ranking of the 125 most populous places in the U.S.

25. Santa Barbara, California

25. Santa Barbara, California

Santa Barbara, California, USA

(Getty Images)

Best Places 2019 Rank: 73
Metro Population: 442,996
Median Home Price: $463,750
Median Annual Salary: $54,320
Unemployment Rate: 3.9%

Santa Barbara’s unemployment rate matches the national average at 3.9%. Residents are likely to find employment in the tourism industry, education and local government. One of the area’s top employers is the University of California—Santa Barbara.

Learn more about Santa Barbara.

24. Worcester, Massachusetts

24. Worcester, Massachusetts

Worcester, Massachusetts, USA Skyline at rush hour.

(Getty Images)

Best Places 2019 Rank: 62
Metro Population: 934,923
Median Home Price: $249,275
Median Annual Salary: $53,110
Unemployment Rate: 3.7%

Located in central Massachusetts, Worcester residents benefit from an unemployment rate below the national average at 3.7%. With a median annual salary of $53,110, Worcester residents receive more than the national average, which is $50,620.

Learn more about Worcester.

23. Baltimore

23. Baltimore

The sunset reflects off the windows of the Baltimore city skyline at dusk, Maryland. This view was taken from Federal Hill Park overlooking the Inner Harbor. (The sunset reflects off the windows of the Baltimore city skyline at dusk, Maryland. This vi

(Getty Images)

Best Places 2019 Rank: 100
Metro Population: 2,790,050
Median Home Price: $248,833
Median Annual Salary: $56,400
Unemployment Rate: 4.2%

Many of Baltimore’s biggest employers are in the health care industry, from Johns Hopkins University and the associated Johns Hopkins Health System to MedStar Health and the University of Maryland Medical System. Baltimore’s unemployment rate, however, is high at 4.2%.

Learn more about Baltimore.

22. Milwaukee, Wisconsin

22. Milwaukee, Wisconsin

Winter sunrise by Lake Michigan. Milwaukee Art Museum reflected in the ice.

(Getty Images)

Best Places 2019 Rank: 61
Metro Population: 1,575,101
Median Home Price: $207,400
Median Annual Salary: $50,070
Unemployment Rate: 3.1%

Milwaukee’s median annual salary, at $50,070, is just $550 below the national average of $50,620. While income sticks close to national numbers, this Wisconsin metro area has an unemployment rate of 3.1%, which is well below the national average of 3.9%.

Learn more about Milwaukee.

20. Portland, Oregon (tie)

20. Portland, Oregon (tie)

Portland, Oregon

(Getty Images)

Best Places 2019 Rank: 8
Metro Population: 2,382,037
Median Home Price: $375,425
Median Annual Salary: $55,330
Unemployment Rate: 3.8%

A flourishing tech industry isn’t the only thing keeping Portland’s median annual salary high and its unemployment rate below the national average. Manufacturing, athletic and outdoor apparel and health care companies all contribute to the local economy.

Learn more about Portland.

20. Sacramento, California (tie)

20. Sacramento, California (tie)

(Getty Images)

Best Places 2019 Rank: 82
Metro Population: 2,268,005
Median Home Price: $389,858
Median Annual Salary: $55,010
Unemployment Rate: 3.7%

Tied at the No. 20 spot with Portland, Sacramento has a median annual salary of $55,010. The capital of California also has an unemployment rate of 3.7%, slightly below the national average of 3.9%.

Learn more about Sacramento.

19. Huntsville, Alabama

19. Huntsville, Alabama

One of the 4 corners of Huntsville's town square.

(Getty Images)

Best Places 2019 Rank: 11
Metro Population: 444,908
Median Home Price: $167,300
Median Annual Salary: $53,600
Unemployment Rate: 3.5%

Home to NASA’s Marshall Space Flight Center, Huntsville attracts aerospace engineers not just for the NASA job opportunities, but also for the aerospace jobs from companies that are based in the area as a result of the government entity’s location.

Learn more about Huntsville.

18. Raleigh and Durham, North Carolina

18. Raleigh and Durham, North Carolina

Photo taken in Raleigh, United States

(Getty Images)

Best Places 2019 Rank: 10
Metro Population: 1,824,266
Median Home Price: $249,294
Median Annual Salary: $53,788
Unemployment Rate: 3.4%

Ranking No. 10 on the overall Best Places to Live list, the Raleigh and Durham metro area is best known for the major universities located in the area – Duke University, University of North Carolina—Chapel Hill and North Carolina State University. The ample college-related job opportunities contribute to a low unemployment rate of 3.4%.

Learn more about Raleigh and Durham.

17. Portland, Maine

17. Portland, Maine

Aerial panorama of Portland, Maine at dusk

(Getty Images)

Best Places 2019 Rank: 23
Metro Population: 525,776
Median Home Price: $223,367
Median Annual Salary: $48,970
Unemployment Rate: 2.6%

Portland’s job market thrives on small businesses, ranging from retail to manufacturing. But the high success rate of small businesses doesn’t keep larger companies from calling the area home, such as L.L. Bean, which is based in Freeport, Maine.

Learn more about Portland.

16. Hartford, Connecticut

16. Hartford, Connecticut

Hartford Connecticut skyline reflection along the banks of the Connecticut River. Hartford is the capital of the U.S. state of Connecticut. Hartford is known for its attractive architectural styles and being the Insurance capital of the United States.

(Getty Images)

Best Places 2019 Rank: 47
Metro Population: 1,213,123
Median Home Price: $215,542
Median Annual Salary: $60,040
Unemployment Rate: 4.2%

The Hartford metro area has an above-average unemployment rate at 4.2%. But as a hub for the insurance industry and other businesses, residents earn a median annual salary of $60,040, nearly $10,000 above the national average.

Learn more about Hartford.

15. Austin, Texas

15. Austin, Texas

Early foggy morning on Ladybird Lake in Austin, Texas.

(Getty Images)

Best Places 2019 Rank: 1
Metro Population: 2,000,590
Median Home Price: $292,500
Median Annual Salary: $51,840
Unemployment Rate: 2.9%

While Austin attracts a wide variety of businesses, with government and education being major employers in the area, it draws a lot of tech companies as well. A less expensive place to set up shop than Silicon Valley, Austin is now considered a major tech hub.

Learn more about Austin.

14. Des Moines, Iowa

14. Des Moines, Iowa

Sunset over the Iowa capitol in Des Moines

(Getty Images)

Best Places 2019 Rank: 5
Metro Population: 623,113
Median Home Price: $178,942
Median Annual Salary: $50,600
Unemployment Rate: 2.4%

While the Des Moines area’s median salary is slightly below the national average of $50,620, the cost of living is far lower, as the typical resident uses just 20.11% of his or her household income on living expenses. The low cost of living is just one factor bringing tech companies and startups to the metro area.

Learn more about Des Moines.

13. San Diego

13. San Diego

San Diego, California cityscape at the Gaslamp Quarter.

(Getty Images)

Best Places 2019 Rank: 36
Metro Population: 3,283,665
Median Home Price: $555,325
Median Annual Salary: $56,410
Unemployment Rate: 3.3%

San Diego attracts residents with its ideal weather and helps them stay with a number of diverse job opportunities. San Diego is home to the U.S. Pacific Fleet and has a large number of military personnel as a result, not to mention opportunities in technology, tourism and research stemming from the area’s universities.

Learn more about San Diego.

12. Santa Rosa, California

12. Santa Rosa, California

Golden hour sunset in Santa Rosa, California over brush along Highway 12.

(Getty Images)

Best Places 2019 Rank: 74
Metro Population: 500,943
Median Home Price: $629,917
Median Annual Salary: $53,890
Unemployment Rate: 2.7%

In the heart of California wine country, Santa Rosa sees a high number of its residents working on farms and at wineries and brewpubs, and a significant portion holding jobs in tourism. Residents benefit from a low unemployment rate of just 2.7%.

Learn more about Santa Rosa.

11. Manchester, New Hampshire

11. Manchester, New Hampshire

Manchester is the largest city in the state of New Hampshire and the largest city in northern New England. Manchester is known for its industrial heritage, riverside mills, affordability, and arts & cultural destination.

(Getty Images)

Best Places 2019 Rank: 43
Metro Population: 406,371
Median Home Price: $234,097
Median Annual Salary: $52,640
Unemployment Rate: 2.5%

With an extremely low unemployment rate of 2.7%, Manchester residents work in a variety of industries, from technology and communications to financial services, health care and manufacturing. At $52,640, the median annual salary is slightly higher than the national average.

Learn more about Manchester.

10. New York City

10. New York City

(Getty Images)

Best Places 2019 Rank: 90
Metro Population: 21,139,370
Median Home Price: $386,862
Median Annual Salary: $63,079
Unemployment Rate: 4%

Naturally, the Big Apple makes the list, with a number of domestic and international businesses calling the area home. New York’s major industries range from finance and fashion to shipping and manufacturing, and the city is considered the financial and publishing capital of the U.S.

Learn more about New York.

9. Madison, Wisconsin

9. Madison, Wisconsin

Wisconsin State Capitol building in a street scene in Madison, Wisconsin

(Getty Images)

Best Places 2019 Rank: 12
Metro Population: 640,072
Median Home Price: $247,967
Median Annual Salary: $52,190
Unemployment Rate: 2.2%

Along with its strong health care industry, Madison has a growing biotechnology market and attracts startups with its low cost of living and proximity to well-connected corporations like health care software company Epic Systems.

Learn more about Madison.

8. Denver

8. Denver

Drone photograph of Denver through Union Station sign

(Getty Images)

Best Places 2019 Rank: 2
Metro Population: 2,798,684
Median Home Price: $393,842
Median Annual Salary: $57,400
Unemployment Rate: 3%

Educational institutions such as the University of Colorado and the University of Denver create a substantial amount of research roles in the area. Strong business in aerospace, defense and tourism also help fuel Denver’s strong job market.

Learn more about Denver.

7. Seattle

7. Seattle

(Getty Images)

Best Places 2019 Rank: 9
Metro Population: 3,735,216
Median Home Price: $442,333
Median Annual Salary: $63,120
Unemployment Rate: 3.9%

Seattle’s job market has an enviable reputation, with the likes of Amazon, Starbucks and Microsoft calling the area home, and major offices for corporations like Google offering highly desired job opportunities as well. The median annual salary is high at $63,120.

Learn more about Seattle.

6. Minneapolis-St. Paul

6. Minneapolis-St. Paul

Minneapolis aerial with Downtown Minneapolis skyline in the background and Loring Park with Loring Pond in the foreground, during early autumn.

(Getty Images)

Best Places 2019 Rank: 6
Metro Population: 3,526,149
Median Home Price: $237,367
Median Annual Salary: $56,030
Unemployment Rate: 2.7%

Minneapolis boasts strong life science, biotechnology and health-tech industries, as well as familiar corporations headquartered in the area, including Target, Best Buy and General Mills. The median annual salary, at $56,030, is above the national average of $50,620.

Learn more about Minneapolis-St. Paul.

5. Honolulu

5. Honolulu

Photo Taken In Honolulu, United States

(Getty Images)

Best Places 2019 Rank: 60
Metro Population: 990,060
Median Home Price: $581,658
Median Annual Salary: $54,030
Unemployment Rate: 2.1%

With active U.S. Army and Air Force bases on Oahu, Honolulu has a sizable percentage of residents in the defense industry, though it’s no surprise tourism is the island’s leading industry. But the individual companies employing the most Honolulu residents are actually in the health care industry. Honolulu has the lowest unemployment rate of the 125 most populous metro areas in the U.S.

Learn more about Honolulu.

4. Boston

4. Boston

Iconic Old State House, Boston, Massachusetts, America

(Getty Images)

Best Places 2019 Rank: 27
Metro Population: 4,771,936
Median Home Price: $423,450
Median Annual Salary: $65,420
Unemployment Rate: 3.1%

With dozens of colleges and universities in the metro area, including Harvard University and Massachusetts Institute of Technology, Boston has guaranteed extensive opportunities in the education and research fields and a young workforce to take advantage of them.

Learn more about Boston.

3. Washington, D.C.

3. Washington, D.C.

Washington DC city view at a orange sunset, including Washington Monument from Capitol building

(Getty Images)

Best Places 2019 Rank: 19
Metro Population: 6,090,196
Median Home Price: $376,767
Median Annual Salary: $69,210
Unemployment Rate: 3.4%

The District of Columbia offers a significant amount of work in the public sector and with government contractors, but it also has a steadily growing number of private-sector companies headquartered in the area, including Marriott International and Mars Inc. in the Maryland and Virginia suburbs, respectively.

Learn more about Washington.

2. San Francisco

2. San Francisco

Each busy day looks exactly the same, but people around are always different. Just take a moment to slow down.

(Getty Images)

Best Places 2019 Rank: 7
Metro Population: 4,641,820
Median Home Price: $768,517
Median Annual Salary: $69,700
Unemployment Rate: 2.7%

In the No. 2 spot on the list is San Francisco, where residents enjoy a strong job market that thrives in tourism, technology, finance and business. San Francisco residents also enjoy a high median annual salary of nearly $70,000.

Learn more about San Francisco.

1. San Jose, California

1. San Jose, California

San Jose is the economic, cultural and political center of Silicon Valley, and the largest city in Northern California.

(Getty Images)

Best Places 2019 Rank: 14
Metro Population: 1,969,897
Median Home Price: $1,080,017
Median Annual Salary: $77,180
Unemployment Rate: 2.6%

The capital of Silicon Valley continues to reign supreme, edging out its neighbor, San Francisco, for the top spot on the list. San Jose has the highest median salary out of the 125 most populous metro areas in the U.S., combined with a below-average unemployment rate.

Learn more about San Jose.

The Best Places to Find a Job in the U.S. are:

The Best Places to Find a Job in the U.S. are:

USA, Florida, Stuart, Aerial view of suburbs

(Getty Images)

  • San Jose, California.
  • San Francisco.
  • Washington, D.C.
  • Boston.
  • Honolulu.
  • Minneapolis-St. Paul.
  • Seattle.
  • Denver.
  • Madison, Wisconsin.
  • New York City.
  • Manchester, New Hampshire.
  • Santa Rosa, California.
  • San Diego.
  • Des Moines, Iowa.
  • Austin, Texas.
  • Hartford, Connecticut.
  • Portland, Maine.
  • Raleigh and Durham, North Carolina.
  • Huntsville, Alabama.
  • Sacramento, California.
  • Portland, Oregon.
  • Milwaukee, Wisconsin.
  • Baltimore.
  • Worcester, Massachusetts.
  • Santa Barbara, California.

Read More

Tags: real estate, housing, housing market, home prices, farming, recession

Devon Thorsby is the Real Estate editor at U.S. News & World Report, where she writes consumer-focused articles about the homebuying and selling process, home improvement, tenant rights and the state of the housing market.

She has appeared in media interviews across the U.S. including National Public Radio, WTOP (Washington, D.C.) and KOH (Reno, Nevada) and various print publications, as well as having served on panels discussing real estate development, city planning policy and homebuilding.

Previously, she served as a researcher of commercial real estate transactions and information, and is currently a member of the National Association of Real Estate Editors. Thorsby studied Political Science at the University of Michigan, where she also served as a news reporter and editor for the student newspaper The Michigan Daily. Follow her on Twitter or write to her at

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