Home prices in Opportunity Zones across the United States continued to climb in the second quarter of 2024, with median values rising in more than half of the areas targeted for economic redevelopment, according to a new report from ATTOM Data, a real estate data firm. The analysis, which looked at 3,904 Opportunity Zones with sufficient data, revealed that median home prices increased from the first to the second quarter in 61% of these zones, with annual gains recorded in 62%.
The rise in prices inside Opportunity Zones—a key component of the Tax Cuts and Jobs Act of 2017 aimed at spurring economic revival in low-income neighborhoods—mirrors the broader national market trends seen during the spring home-buying season. Nearly half of the zones analyzed saw median prices shoot up by more than 10% on a quarterly and annual basis.
“The trickle-down impact of the extended housing market boom across the U.S. continues to uplift many neighborhoods in need, revealing their economic potential,” said Rob Barber, CEO of ATTOM. “This pattern is especially evident in Opportunity Zones as house hunters priced out of more-expensive areas turn to places they can afford.”
Despite these gains, most Opportunity Zones still had typical home values that were significantly lower than the national median. In the second quarter, 80% of the zones had median prices below the U.S. median of $365,000, with almost half reporting values under $200,000.
Regional variations and state trends
The report highlighted significant regional variations, with higher-priced Opportunity Zones experiencing more substantial gains than lower-priced areas. In the Midwest, 61% of zones had median home prices below $175,000, the highest proportion of low-cost zones among U.S. regions.
States with the largest portions of zones where median prices increased quarterly included Massachusetts (73%), Maryland (68%), Oregon (68%), New York (67%), and Virginia (65%). In contrast, states like Georgia (50%), Louisiana (53%), and California (56%) saw more modest increases.
On an annual basis, New Jersey led the way, with 81% of its Opportunity Zones reporting median price increases, followed by Nevada (79%) and Ohio (73%).
Opportunity zones outperform national market in some areas
In a notable trend, 45% of Opportunity Zones outpaced the national 9% median home price increase from the first to the second quarter of 2024, a higher proportion than in local housing markets outside these zones.
However, the report also pointed out that price gains were less consistent in zones where homes typically sold for less than $125,000. In these lower-priced areas, only 45% of zones saw quarterly and annual price increases, compared to 60% to 66% of zones with higher home values.
High-level findings from the report:
- Median prices of single-family homes and condos increased from the first to the second quarter of 2024 in 1,932 (61%) of the Opportunity Zones around the U.S. with sufficient data to analyze, while staying the same or decreasing in 39%. Measured annually, medians remained up from the second quarter of 2023 to the same period this year in 2,140 (62%) of those zones. (Among the 3,904 Opportunity Zones included in the report, 3,185 had enough data to generate usable median-price comparisons from the first to the second quarter of 2024; 3,456 had enough data to make comparisons between the second quarter of 2023 and the second quarter of 2024).
- Opportunity Zones did even better than the rest of the nation when comparing price changes to shifts in the national median home price. Median values in 45% of Opportunity Zones went up from the first to the second quarter of this year by more than the 9% annual gain nationwide. The same was true in slightly less—41%—of local housing markets outside the zones. (A similar pattern emerged when comparing shifts in prices annually.)
- However, median prices were up quarterly and annually in only about 45% of Opportunity Zones where homes commonly sold for less than $125,000 during the second quarter of 2024. Prices climbed during that time frame in 60% to 66% of zones with higher home values.
- Among states that had at least 25 Opportunity Zones with enough data to analyze during the second quarter of 2024, the largest portions of zones where median prices increased quarterly were in Massachusetts (medians up from the first to the second quarter of 2024 in 73% of zones), Maryland (68%), Oregon (68%), New York (67%) and Virginia (65%). States where prices were up quarterly in the smallest portion of zones included Georgia (median prices up in 50% of zones), Louisiana (53%), Minnesota (56%), Kentucky (56%) and California (56%).
- States where median home values in Opportunity Zones remained up most often year over year included New Jersey (median prices up annually in 81% of zones), Nevada (79%), Ohio (73%), New Mexico (69%) and Virginia (69%).
- Of the 3,904 zones in the report, 1,148 (29%) had median prices below $150,000 in the second quarter of 2024. That was down from 34% of zones with sufficient data a year earlier and almost 60 % five years ago. Another 647 zones (17%) had medians in the second quarter of this year ranging from $150,000 to $199,999.
- Median values in the second quarter of 2024 ranged from $200,000 to $299,999 in 23% of Opportunity Zones, while they topped the nationwide second-quarter median of $365,000 in just 20%.
- The Midwest continued in the second quarter of 2024 to have larger portions of the lowest-priced Opportunity Zone tracts. Median home prices were less than $175,000 in 61% of zones in the Midwest, followed by the Northeast (41 %), the South (39%) and the West (5%).
Click here for the entire report.
