TheMReport — News and strategies for the evolving mortgage marketplace.

Issue link:

Contents of this Issue


Page 49 of 67

48 | M REPORT O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Pace of Gains in Opportunity Zones Surpasses Nationwide Increase Median home prices rose in majority of Opportunity Zones targeted for improvement, with prices again up nearly 20% annually. A TTOM released its Q 4 2021 special report analyzing qualified low-income Opportu- nity Zones targeted by Con- gress, for economic redevelop- ment in the Tax Cuts and Jobs Act of 2017. The report found that median single-family home and condo prices rose from Q 3 to Q 4 of 2021 in 56% of Oppor- tunity Zones around the coun- try and spiked by an estimated 20% annually in almost half the nation. While the pace of increases slowed in Q 4, median values rose in about half the zones by more than the 16.1% gain seen nation- wide from Q 4 of 2020 to Q 4 of 2021. Typical homes in Opportunity Zones continued to cost a fraction of those in most other neighbor- hoods around the nation in Q 4 of 2021. Median Q 4 prices sat below the national median of $315,648 in 76% of Opportunity Zones, about the same as in earlier periods last year. "Neighborhoods in and around some of the poorest areas of the United States kept riding the national housing market boom in the fourth quarter of last year, much as they did throughout 2021. The pace of price increases slowed, which is common in the last few months of any year. But gains in Opportunity Zones again pretty much matched what was going on elsewhere and even beat out the rest of the market in some ways," said Todd Teta, CPO with ATTOM. Typical values remained under $200,000 in 51% of the zones during Q 4 of 2021; however, that improved from 53% in Q 3 of 2021, and 61% last year. Markets inside some of the nation's poorest com- munities improved despite the on- going threat from the Coronavirus pandemic, which hit those areas hardest with its onset in 2020. Price spikes of at least 25% from Q 4 of 2020 to the same period in 2021 showed up in a larger portion of Opportunity Zones than in other neighborhoods around the country. Prices inside Opportunity Zones kept growing during Q 4 of 2021, as a decade-long price boom in the U.S. continued to spread throughout every part of the country, including low-income communities. "While Opportunity Zone markets remained depressed, the increases probably reflected the trickle-down effect of buy- ers priced out of more expensive neighborhoods. The gains also represented an ongoing sign of vitality in lower-income areas— something that ups the ante for investors looking to take advantage of Opportunity Zone tax breaks." The trend persists as a surge of buyers continue chasing a tight supply of homes for sale. The buying surplus has propelled the market amid a combination of historically low mortgage rates, fueling the desire for many house- holds to trade life in congested ar- eas for the safety and larger space for work-at-home lifestyles offered by houses or condominiums.

Articles in this issue

Archives of this issue

view archives of TheMReport - _FULL-MReport_March2022