New tax breaks are aimed at spurring improvement in low-income Opportunity Zone areas of the United States; almost half have median home prices below $150,000
ATTOM Data Solutions, curator of the nation’s premier property database and first property data provider of Data-as-a-Service (DaaS), today released a special report analyzing qualified Opportunity Zones established by Congress in the Tax Cuts and Jobs act of 2017 (see full methodology below). In this report, ATTOM looked at nearly 3,100 zones with sufficient sales data to analyze, which included areas with at least five home sales in the second quarter of 2019 as well as an average of at least five sales per quarter since Q3 2018.
The analysis found that roughly 80 percent of those zones had median home prices in the second quarter of 2019 that were below the national figure of $266,000 and that half had median prices of less than $150,000.
The report further compared Opportunity Zones to surrounding regions and found that median Q2 2019 prices in about one in four zones were less than 50 percent of the typical value in the Metropolitan Statistical Areas where they exist.
“Opportunity Zones are among the poorest areas of the country, with some of the lowest home prices. This should come as no surprise because the zones are designed to be in or alongside economically distressed neighborhoods,” said Todd Teta, chief product officer with ATTOM Data Solutions. “But the differences between these and other areas in most parts of the nation are stark. The numbers provide key benchmarks for how much room there is for these areas to grow and how much new investment they need.”
High-level findings from the report include:
- States with the highest percentage of census tracts meeting Opportunity Zone requirements include Wyoming (17 percent), Mississippi (15 percent), Alabama (13 percent), North Dakota (12 percent) and New Mexico (12 percent). Washington, DC, also is among the leaders (14 percent). Nationwide, 10 percent of all tracts qualify.
- Among the 3,073 Opportunity Zones with sufficient data to analyze, California has the most, with 374, followed by Florida (317), Texas (164), Pennsylvania (154), North Carolina (145) and Tennessee (138).
- Of the tracts analyzed, 47 percent had a median price in Q2 2019 of less than $150,000. The median ranged from $150,000 to $199,999 in 17 percent, from $200,000 up to the national median of $266,000 in 16 percent and more than $266,000 in 19 percent.
- Within Opportunity Zones, 86 percent had median Q2 2019 sales prices that were less than the median sales price for the surrounding Metropolitan Statistical Area. Roughly 26 percent had median sales prices less than half the figure for the MSA. Only 14 percent had median sales prices that were equal to or above the median sales price in the MSA.
- States that had highest percentage of Opportunity Zone tracts with a median price less the half the MSA figure included Alabama (55 percent), Pennsylvania (53 percent), Illinois (51 percent), Ohio (47 percent) and Georgia (45 percent). States with the smallest percentages included Washington (1 percent), Nevada (3 percent), Oregon (4 percent) Colorado (4 percent) and Indiana (4 percent).
- Regionally, the Midwest had the highest rate of Opportunity Zone tracts with a median home price of less than $150,000 (73 percent), followed by the South (57 percent), the Northeast (53 percent) and the West (13 percent).
- The Midwest also had the highest percentage of Opportunity Zone tracts where the median price was less than that of surrounding MSAs (89 percent), followed by the Northeast (87 percent), the South (85 percent) and the West (85 percent).
In addition, the report found that among Opportunity Zones with at least 10 sales in each of the five latest quarters, 41 had Q2 2019 medians of $400,000 or more. They included areas of King County, WA; Denver County, CO; Coconino County, AZ; Deschutes County, OR and Alameda and Contra Costa counties in California.
At the opposite end, 50 zones had Q2 2019 medians of less than $50,000. They included areas of Philadelphia, PA; Baltimore, MD; Montgomery, AL; Duval County, FL and Jefferson County, AL.
The ATTOM Data Solutions Opportunity Zones analysis is based on home sales price data derived from recorded sales deeds. Statistics for previous quarters are revised when each new report is issued as more deed data becomes available. ATTOM Data Solutions compared median home prices in tracts designated as Opportunity Zones by the Internal Revenue Service. Except where noted, tracts were used for the analysis if they had at least five sales in Q2 2019, plus an average of five sales per quarter for the latest four quarters. Median household income data for tracts and counties comes from surveys taken the U.S. Census Bureau (www.census.gov) from 2013 through 2017. The list of designated Qualified Opportunity Zones is located at U.S. Department of the Treasury. Regions are based on designations by the Census Bureau. Hawaii and Alaska, which the bureau designates as part of the Pacific region, were included the West region for this report.
About ATTOM Data Solutions
ATTOM Data Solutions provides premium property data to power products that improve transparency, innovation, efficiency and disruption in a data-driven economy. ATTOM multi-sources property tax, deed, mortgage, foreclosure, environmental risk, natural hazard, and neighborhood data for more than 155 million U.S. residential and commercial properties covering 99 percent of the nation’s population. A rigorous data management process involving more than 20 steps validates, standardizes and enhances the data collected by ATTOM, assigning each property record with a persistent, unique ID — the ATTOM ID. The 9TB ATTOM Data Warehouse fuels innovation in many industries including mortgage, real estate, insurance, marketing, government and more through flexible data delivery solutions that include bulk file licenses, APIs, market trends, marketing lists, match & append and introducing the first property data deliver solution, a cloud-based data platform that streamlines data management – Data-as-a-Service (DaaS).
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