ATTOM: Home Prices in Opportunity Zones See Annual Increases
ATTOM Data Solutions, Irvine, Calif., said nearly half of Opportunity Zones saw median home prices rise more than the national increase of 9.4 percent from fourth quarter 2018 to fourth quarter 2019.
The company’s third special report analyzing qualified Opportunity Zones established by Congress in the Tax Cuts and Jobs act of 2017 looked at nearly 3,700 zones with at least five home sales in each quarter from 2005 through 2019.
The report also sowed 78 percent of the zones had median home prices in the fourth quarter that were less than the national median of $257,000, nearly the same percentage as a year ago. Forty-eight percent of zones had median prices of less than $150,000.
“Home prices in thousands of Opportunity Zone neighborhoods targeted for revival across the United States continued to ride the tide of the national housing market boom in the fourth quarter of 2019, marching along with broad trends and even doing better in many areas,” said Todd Teta, chief product officer with ATTOM Data Solutions. “These areas are among the most vulnerable to economic downturns. As a result, the recent upswing could change on a dime if the broader housing market flattens out or sags. But for now, the price gains are a crucial measure that neighborhoods designated as Opportunity Zone tax breaks hold significant allure for potential residents.”
Other report findings:
–Median prices rose from fourth quarter 2018 to the fourth quarter of 2019 in 66 percent of the Opportunity Zones with sufficient data to analyze. In 34 percent of zones, they declined or stayed the same.
–Median prices in 47 percent of Opportunity Zones with sufficient data to analyze rose year-over-year more than values increased nationally. The national increase from the fourth quarter of 2018 to the fourth quarter of 2019 was 9.4 percent.
–In 20 states, year-over-year median price increases in at least half the Opportunity Zones beat the national 9.4 percent figure. Those with the most such zones were Pennsylvania, North Carolina, Arizona, Ohio and New Jersey.
–California had the most sales, with 465, followed by Florida (332), Texas (234), Pennsylvania (166) and North Carolina (165).
–1,776 (48 percent) had a median price of less than $150,000 in fourth quarter 2019, and 594 (16 percent) had medians ranging from $150,000 to $199,999. Another 529 (14 percent) ranged from $200,000 up to the national median price of $257,000, while 817 (22 percent) were more than $257,000.
–In Metropolitan Statistical Areas, 84 percent of Opportunity Zones had median fourth quarter sales prices that were less than the median values for the surrounding MSAs. Among those, 25 percent had median sales prices that were less than half the figure for the MSAs. At the same time, 16 percent of the zones had median sales prices that were equal to or above the median sales price of the broader MSAs.
–The Midwest continued to have the highest rate of Opportunity Zone tracts with a median home price of less than $150,000 (73 percent), followed by the South (58 percent), the Northeast (51 percent) and the West (12 percent).
–States with the highest percentage of census tracts meeting Opportunity Zone requirements included Wyoming (17 percent), Mississippi (15 percent), Alabama (13 percent), North Dakota (12 percent) and New Mexico (12 percent). Washington, DC, was also among the leaders (14 percent). Nationwide, 10 percent of all tracts qualify.