Opportunity Zones Following Larger Housing Market Trends

ATTOM Data’s most recent report analyzing qualified low-income Opportunity Zones covering the fourth-quarter of 2023 looked at 3,667 zones around the country. 

Overall, the report found that median single-family home and condo prices dropped from the third quarter of 2023 to the fourth quarter of 2023 in 52% of Opportunity Zones, a number which declined by 3%. 

Opportunity Zones are defined as a census tract in, or alongside low-income neighborhoods targeted by Congress for economic redevelopment through the Tax Cuts and Jobs Act of 2017. Census tracts cover areas with 1.200 to 8,000 residents, with an average of about 4,000 residents. 

According to ATTOM, these downturns—in and around low-income neighborhoods where the federal government offers tax breaks to spur economic revival—closely tracked alongside nationwide price trends as a decade-long boom in the housing market showed signs of slowing down. 

The latest trends also continued a long-term pattern of home values inside Opportunity Zones moving alongside broader nationwide gains and losses for at least the last three years. This fact marks an ongoing sign of economic tides rising or falling inside some of the country’s most vulnerable and distressed communities alongside other markets around the country. 

Opportunity Zones showed signs again of even doing slightly better than other neighborhoods around the country. For example, while prices generally decreased, a slightly larger portion of Opportunity Zones saw significant price increases in the fourth quarter compared to other locations around the U.S. 

“The fourth quarter of last year certainly wasn’t a great one for Opportunity Zone home values, with more losses than gains. But within the bigger picture, those areas keep riding national coattails, whether home values are going up or whether they are going down. Nothing jumped out as much worse than what happened throughout the nation,” said Rob Barber, CEO for ATTOM. “This has clearly become an extended story as the zones continue to attract home-buyer interest in a very tight housing market. More broadly, it also shows the kind of economic strength inside Opportunity Zones that the legislation is designed to use as a springboard to attract investors.” 

The median fourth-quarter sales prices were less than the U.S. median sales price of $333,000 in 79% of Opportunity Zones. That was about the same portion as in earlier periods over the past year. In addition, median prices remained under $200,000 in 51% of the zones during the fourth quarter of 2023. 

High-level findings from the report include: 

  • Median prices of single-family homes and condominiums decreased from the third quarter of 2023 to the fourth quarter of 2023 in 1,729 (52%) of the Opportunity Zones around the U.S. with sufficient data to analyze, while staying the same or increasing in 48%. Medians, however, were still up from the fourth quarter of 2022 to same period last year in 1,958 (60%) of those zones. (Among the 3,667 Opportunity Zones included in the report, 3,294 had enough data to generate usable median-price comparisons from the third quarter of 2023 to the fourth quarter of 2023; 3,247 had enough data to make comparisons between the fourth quarter of 2022 and the fourth quarter of 2023). 
  • Prices declined more quarterly or rose more annually than they did nationwide in almost the same portion of Opportunity Zones as elsewhere. The median single-family home value decreased from the third to the fourth quarter of 2023 by more than the national figure in 46% of Opportunity Zones tracts and 45% of tracts outside the zones. The median price rose, year over year, by more than the national figure in 50% of Opportunity Zones tracts and 48% of tracts outside the zones. (The nationwide median dropped 3.4% quarterly but was still up 5.2% from the fourth quarter of 2022 to the fourth quarter of 2023.) 
  • In one sign that Opportunity Zones again did a bit better than the rest of the country, median prices grew quarterly by at least 5% in a higher portion of those areas. Typical values went up at least that much quarterly in 38% of Opportunity Zones with enough data but in just 33% of other neighborhoods around the U.S. Medians also remained up annually by at least 10% more often in Opportunity Zones than elsewhere (42% versus 38%). 
  • Among states that had at least 25 Opportunity Zones with enough data to analyze during the fourth quarter of 2023, the largest portions of zones where median prices decreased quarterly were in Kentucky (medians down from the third quarter of 2023 to the fourth quarter of 2023 in 66% of zones); Minnesota (65%); Arizona (62%); California (61%); and Maryland (61%). States where prices were up quarterly in the largest portion of zones included Louisiana (median prices up quarterly in 67% of zones); Utah (63%); Missouri (54%); Ohio (53%); and Indiana (53%). 
  • States where median home values in Opportunity Zones remained up most often year over year included New Jersey (median prices up annually in 83% of zones); Missouri (77%); Wisconsin (72%); Virginia (68%); and Michigan (66%). 
  • Of the 3,667 zones in the report, 1,262 (34%) had median prices in the fourth quarter of 2023 that were less than $150,000. That was down from 37% of zones with sufficient data a year earlier. Another 604 zones (16%) had medians in the fourth quarter of last year ranging from $150,000 to $199,999. 
  • Median values in the fourth quarter of 2023 ranged from $200,000 to $299,999 in 825 Opportunity Zones (22%) while they topped the nationwide fourth-quarter median of $333,000 in just 768 (21%). 
  • The Midwest continued in the fourth quarter of 2023 to have larger portions of the lowest-priced Opportunity Zone tracts. Median home prices were less than $175,000 in 66% of zones in the Midwest, followed by the Northeast (46%), the South (45%) and the West (6% 

Click here to see the report in its entirety. 

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Kyle G. Horst

Kyle G. Horst is a reporter for MortgagePoint. A graduate of the University of Texas at Tyler, he has worked for a number of daily, weekly, and monthly publications in South Dakota and Texas. With more than 10 years of experience in community journalism, he has won a number of state, national, and international awards for his writing and photography including best newspaper design by the Associated Press Managing Editors Group and the international iPhone photographer of the year by the iPhone Photography Awards. He most recently worked as editor of Community Impact Newspaper covering a number of Dallas-Ft. Worth communities on a hyperlocal level. Contact Kyle G. at kyle.horst@thefivestar.com.
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