Mississippi is in a state of mixed housing markets. Along the Gulf Coast there's more land for sale than in many years and rebuilding is slow with a lack of affordable housing on the market. Inland cities have seen post Katrina growth as residents relocated from the devastated regions of New Orleans and the Gulf Coast. Throughout Mississippi the credit crunch is slowing real estate sales and new housing starts as the flow of money tightens.

Obliterated by Hurricane Katrina, the Mississippi Gulf Coast in Biloxi is caught in a weird real estate time warp. Nearing three years after Katrina the majority of miles upon miles of homes that stretched along the waterfront are not being rebuilt. Only the foundations of the old plantation mansions that adorned the street remain, many covered by growing patches of weeds.

Thousands of home owners have been left with little else to do, but leave the area with hopes of a better life after insurance companies failed to pay their claims to rebuild their homes. Thousands of lawsuits are underway against the carriers, but as time mounts few have very little hope of ever collecting.

In Biloxi a post Katrina boost in home sales gave the real estate market a short and once promising future. But when the credit crunch hit and mortgages got harder to get the housing market slowed. Eleven casinos have reopened to attract gamblers for business, and plans are underway for others. But rebuilding is slow.

City	Forecast
Jackson	− 6.8%
Biloxi	4.9%
Pascagoula	3.8%
Hattiesburg	3.7%

More than two dozen condominium projects planned for Biloxi are in a wait and see mode. Some 4,000 condo units were planned before Katrina and now there are 12,000 units under proposal, which would turn the city into a condo haven.

A special federal and state "Gulf Zone" investment and tax incentive program has been developed to attract investors and new home builders to the area. The Mississippi governor says the area needs at least 100,000 new homes right now and as many as 300,000 over the next three to five years, and the big news for investors is that real estate is still comparatively cheap in the Biloxi area.

Before Katrina Biloxi had the second largest gambling center to Las Vegas in the U.S. But the hurricane wiped almost all of it away. Biloxi is on a path to a slow but promising future. Homes are selling, especially in the lower price ranges, but it will take many years for the area to rebuild.

The redevelopment will take years, perhaps decades to occur. But Biloxi's future is promising, which still keeps Biloxi on the positive side in its 2008 Housing Predictor forecast. Biloxi is forecast to appreciate a slower and lower 4.9% in average housing values by the year's end.

In nearby Pascagoula the real estate market has also been slowed. Rebuilding after the storm has been slow, but homes are still selling. Pascagoula is seeing a new sort of housing market develop as more and more people want to return to the area.

The market should be active but still sluggish through 2008 with forecast appreciation of 3.8%.

In the state's largest metropolitan area of Jackson the credit crunch has brought nearly a halt to the construction of new homes. New creative financing along with subprime mortgages are hurting the local economy as foreclosures increase. Jackson saw a post Katrina run-up in housing prices after many people relocated to the area, but Jackson home sales have slowed and will slow further in 2008, accounting for the first forecast price decline in years at 6.8%. Foreclosures will have a huge impact on Jackson.

In Hattiesburg the market is still fairly active as a result of a lack of housing on the Gulf Coast. Hattiesburg has been one of those areas not too far inland from the gulf that has actually benefited from post Katrina growth. Homes are in demand and most properties are maintaining their values, which is a major exception to the national trend.

Hattiesburg has been affected by an increase in foreclosures, but they should not have a major impact on the market's growth at least through 2008. Hattiesburg is due to appreciate a modest 3.7% for the year.