According to the Zillow Home Value Index, some Alabama towns are riding high—and maybe a little too high. After analyzing 15 years of price trends, volatility spikes, and momentum shifts, we found 18 markets that look eerily like they did before past crashes. Some have soared well beyond their long-term averages; others are seeing the kind of shaky growth that doesn’t usually end gently.
18. Orange Beach – Crash Risk Percentage: 70%
- Crash Risk Percentage: 70%
- Historical crashes (5%+ drops): 1
- Worst historical crash: -13.7% (2011)
- Total price increase since 2010: 94.9%
- Overextended above long-term average: 48.3%
- Price volatility (annual swings): 7.7%
- Current 2025 price: $698,608
Orange Beach shows classic warning signs of a market vulnerable to correction, with prices nearly doubling since 2010 and currently sitting 48% above historical trends. The coastal resort town experienced a brutal 13.7% crash in 2011, proving this market can experience rapid declines when economic conditions shift. Recent data shows momentum cooling, with 2025 prices dropping 2.7% from their 2024 peak.
Orange Beach – Coastal Resort Town Showing Cooling Momentum
Located on Alabama’s Gulf Coast, Orange Beach has transformed from a small fishing village into a premier vacation destination, driving massive real estate appreciation over the past decade. The town’s economy relies heavily on tourism and vacation rentals, making it particularly susceptible to economic downturns that reduce discretionary travel spending. Current median home prices of nearly $700,000 represent a dramatic departure from the area’s historical affordability, pricing out many traditional buyers.
The resort town’s vulnerability stems from its dependence on external economic factors and second-home buyers who can quickly exit the market during uncertain times. Orange Beach’s 7.7% annual price volatility indicates an unstable market prone to sudden swings, while the recent price decline suggests the rapid appreciation may be losing steam. The combination of extreme overvaluation and economic sensitivity creates conditions ripe for a significant correction.
17. Silverhill – Crash Risk Percentage: 70%
- Crash Risk Percentage: 70%
- Historical crashes (5%+ drops): 1
- Worst historical crash: -12.7% (2011)
- Total price increase since 2010: 108.1%
- Overextended above long-term average: 58.5%
- Price volatility (annual swings): 8.2%
- Current 2025 price: $297,353
Silverhill demonstrates concerning overextension with prices more than doubling since 2010 and currently trading 58% above long-term averages. This small Baldwin County community proved vulnerable during the last housing correction, losing nearly 13% of its value in 2011. The market’s 8.2% annual volatility suggests underlying instability that could trigger rapid price movements.
Silverhill – Small Town With Outsized Price Growth
This unincorporated community in Baldwin County has experienced dramatic transformation as Gulf Coast development pressures spread inland, pushing median home prices to nearly $300,000. Silverhill’s rural character attracted buyers seeking more affordable alternatives to expensive coastal markets, but this migration has created its own bubble dynamics. The town’s limited infrastructure and employment opportunities make it heavily dependent on commuters and retirees, both sensitive to economic changes.
The community’s 108% price appreciation since 2010 far exceeds underlying economic fundamentals, creating mathematical unsustainability that increases crash risk. Silverhill’s previous crash experience demonstrates that this market can lose significant value quickly when buyer demand shifts. The combination of extreme overvaluation relative to local income levels and dependence on external economic factors positions this market for potential correction.
16. Gulf Shores – Crash Risk Percentage: 70%
- Crash Risk Percentage: 70%
- Historical crashes (5%+ drops): 1
- Worst historical crash: -13.4% (2011)
- Total price increase since 2010: 101.6%
- Overextended above long-term average: 49.2%
- Price volatility (annual swings): 7.8%
- Current 2025 price: $466,425
Gulf Shores exhibits multiple crash warning signs including a devastating 13.4% decline in 2011 and current overextension of 49% above historical norms. The popular beach destination has seen prices more than double since 2010, reaching nearly $470,000 for median homes. Recent momentum appears to be stalling, with 2025 prices showing early signs of decline.
Gulf Shores – Tourism-Dependent Market Showing Vulnerability
As Alabama’s most famous beach destination, Gulf Shores has built its real estate market on tourism and vacation home demand, creating inherent vulnerability to economic cycles. The city’s economy revolves around hospitality, vacation rentals, and seasonal businesses, making it highly sensitive to changes in consumer spending and travel patterns. Current median home prices of $466,425 represent a massive premium over Alabama’s overall housing costs, supported primarily by out-of-state buyers and investors…