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Chattanooga, TN

The Bad: The recession hit Chattanooga pretty hard, with the city’s GDP down 7 percent from 2008 to the end of 2009. Plus, the city has a high crime rate.

The Good: The unemployment rate has dropped to 8.3 percent from 8.8 percent. Plus, the real-estate market is showing some signs of improvement: Home prices and sales are both on the rise. Chattanooga is known as one of the most affordable cities in the U.S. and it’s surrounded by mountains, earning it the nickname “Scenic City.” Sperling adds that it also has a revitalized downtown, with parks, museums and a highly-rated aquarium.

The Recovery: Chattanooga has scored several wins. Volkswagen just built a $1 billion plant in Chattanooga and has already hired 1,500 workers, which has helped the economy. Plus, the city got a new chemical plant and Amazon has announced plans to build a distribution center here.

Photo: Walter Bibikow | The Image Bank | Getty Images