Property data curator ATTOM released its fourth-quarter 2024 report analyzing qualified low-income Opportunity Zones targeted by Congress for economic redevelopment in the Tax Cuts and Jobs Act of 2017. In this report, ATTOM examined 3,783 zones that had at least five home sales in the fourth quarter.
The report found that median single-family home and condo prices increased from the third to fourth quarter in 49 percent of Opportunity Zones with enough data to measure. Prices were up annually in 61 percent of those zones.
As the nation’s 13-year housing market boom continued, median prices grew more than 10 percent annually in almost half the Opportunity Zones analyzed, according to the ATTOM report.
Those trends, in and around low-income neighborhoods where the federal government offers tax breaks to spur economic revival, extended a long-term pattern of home values inside Opportunity Zones closely tracking broader nationwide price shifts for at least the last three years, according to ATTOM.
Typical values rose more in higher-priced zones than in the lowest-priced neighborhoods. That continued to reveal how the bottom of the housing market is benefitting less from the national run of price increases, according to ATTOM’s report.
By several measures, Opportunity Zones enjoyed more progress than the nation as a whole during the fourth quarter. For example, the ATTOM report found median price increases bested typical nationwide gains in a slightly larger portion of Opportunity Zones than elsewhere.
“Micro-markets inside Opportunity Zones continue to reap remarkably consistent benefits from the home-price boom that is still reaching far and wide across the country. Again and again, we are seeing notable levels of economic potential in these areas that have long been in need of revival,” ATTOM CEO Rob Barber said in a release. “This keeps happening as rising values and tight supplies of homes for sale push many buyers on limited budgets into areas they may not have considered a few years ago.”
He added that “Opportunity Zone price trends are far from consistent, with the lowest-end areas struggling to keep up. That’s a warning sign for those neighborhoods. But the big takeaway from the latest data is that significant money is flowing into these locations, which can provide a stepping-stone for the investment that the Opportunity Zone legislation is intended to spur.”
Typical home values across wide swaths of Opportunity Zones remained below those around most of the nation in the final months of 2024. Median fourth-quarter prices inside about 80 percent of the zones stood below the median of $360,000. That was about the same portion as in earlier periods over the past three years. In addition, median prices were less than $200,000 in almost half the zones.
Median values either dropped or increased by at least 5 percent in nearly three-quarters of the Opportunity Zones from the third to fourth quarter.
The latest overall trends in Opportunity Zones generally matched the nationwide path of prices, which went up 1 percent quarterly and 9 percent annually during the last few months of 2024.
The latest increases came as buyers buoyed by rising wages and a strong investment market chased the ongoing short supply of homes for sale, according to ATTOM’s report. Those forces helped offset an increase in mortgage rates, which rose back up close to an average of 7 percent for a 30-year fixed loan.
Median prices of single-family homes and condos increased from the third to fourth quarter in 1,652 (49 percent) of the Opportunity Zones with sufficient data to analyze, while staying the same or decreasing in 51 percent. Median prices remained up year-over-year in 1,984 (61 percent) of those zones.
Among the 3,783 Opportunity Zones included in the report, 3,375 had enough data to generate usable median-price comparisons from the third to the fourth quarter of 2024, while 3,256 had enough data to make comparisons between the fourth quarter of 2023 and the fourth quarter of 2024.
Median prices were up annually in 47 percent of Opportunity Zones where homes commonly sold for less than $125,000 during the fourth quarter. Prices climbed during that time frame in 60 percent to 70 percent of zones with higher home values.
Among states that had at least 25 Opportunity Zones with enough data to analyze, the largest portions of zones where median prices increased annually were in Indiana (medians up from the fourth quarter of 2023 to the fourth quarter of 2024 in 75 percent of zones), Missouri (74 percent), Wisconsin (73 percent), Kentucky (72 percent) and New Jersey (71 percent). States where prices were up annually in the smallest portion of zones included Louisiana (44 percent), Alabama (44 percent), Arizona (46 percent), Florida (50 percent) and Texas (50 percent).
States where median home values in Opportunity Zones were up most often quarterly included Kentucky (medians up from the third to the fourth quarter in 71 percent of zones), Colorado (62 percent), Wisconsin (57 percent), Utah (56 percent) and Arizona (55 percent).
Of the 3,783 zones in the report, 1,152 (30 percent) had median prices below $150,000 in the fourth quarter. That was down from 35 percent of zones a year earlier and almost 60 percent five years ago. Another 580 zones (15 percent) had medians ranging from $150,000 to $199,999.
Median values ranged from $200,000 to $299,999 in 25 percent of Opportunity Zones while they topped the nationwide fourth-quarter median of $360,000 in 20 percent.
The Midwest continued to have larger portions of the lowest-priced Opportunity Zone tracts. Median home values were less than $175,000 in 59 percent of zones in the Midwest, followed by the South (42 percent), the Northeast (41 percent) and the West (5 percent).
Median household incomes in 86 percent of the Opportunity Zones analyzed were less than the medians in the counties where they were located. Median incomes were less than three-quarters of county-level figures in 52 percent of those zones and less than half in 13 percent.