Opportunity Zone Housing Prices Keeping Up with National Valuations

Housing prices in the so-called Opportunity Zone areas are mostly keeping pace with national valuations, according to a Q4 2021 report from real estate data curator ATTOM.

Opportunity Zones are qualified low-income areas targeted by Congress for economic redevelopment in the Tax Cuts and Jobs Act of 2017.

The report found that median single-family home and condo prices rose from the third quarter of 2021 to the fourth quarter of 2021 in 56 percent of opportunity zones around the country and spiked by at least 20 percent annually in almost half.

While the pace of increases slowed a bit in the fourth quarter, median values still went up in about half the zones by more than the 16.1 percent gain seen nationwide from the fourth quarter of 2020 to the fourth quarter of 2021.

In this report, ATTOM looked at 5,180 zones nationwide with sufficient data to analyze, meaning those areas had at least five home sales in Q4 2021.

Majority of Homes Priced Below $200,000

Typical homes in Opportunity Zones did continue to cost just a fraction of those in most other neighborhoods around the nation in the fourth quarter of 2021. Median fourth-quarter prices sat below the national median of $315,648 in 76 percent of Opportunity Zones, about the same as in earlier periods last year.

Typical values also remained under $200,000 in 51 percent of the zones during the fourth quarter of 2021. But that improved from 53 percent in the third quarter of 2021 and 61 percent a year earlier, as markets inside some of the nation’s poorest communities improved despite the ongoing threat from the Coronavirus pandemic that hit those areas hardest when it struck in 2020.

In one sign of even stronger growth, price spikes of at least 25 percent from the fourth quarter of 2020 to the same period in 2021 showed up in a larger portion of Opportunity Zones than in other neighborhoods around the country.