Both my home and my office are in Federal Opportunity zones. What is an Opportunity zone?
From the IRS website:
“Qualified Opportunity Zones were created by the 2017 Tax Cuts and Jobs Act. These zones are designed to spur economic development and job creation in distressed communities throughout the country and U.S. possessions by providing tax benefits to investors who invest eligible capital into these communities. Taxpayers may defer tax on eligible capital gains by making an appropriate investment in a Qualified Opportunity Fund and meeting other requirements.”
My home in the West 7th neighborhood and my office in Lowertown are both in opportunity zones. The median income in downtown St. Paul is quite low at least according to the data I can find which is hard to imagine considering the number of luxury condos and apartments in the neighborhood and the difficulties people are having finding affordable housing in the neighborhood.
My neighborhood, West 7th, has become somewhat gentrified. There has been a lot of investment. Property values and taxes have gone way up making it less affordable every year, yet the neighborhood is considered distressed and is now in an opportunity zone.
The Dayton’s Bluff neighborhood isn’t in an opportunity zone. The median income level in the Dayton’s buff neighborhood is 9% less than the median income level in the West 7th neighborhood. Median home sale prices for 2019 are 175K for Dayton’s Bluff a 211K for the homes in the distressed West 7th neighborhood in the opportunity zone.
Here is a map with Opportunity zones in and around St. Paul. For more information go to irs.gov and type “opportunity zone” in the search window. Also, see the St. Paul opportunity zone web site. Over a fifth of St. Paul is in an opportunity zone which seems fair considering the 20% poverty rate.
If there are any advantages in owning or buying a home in an opportunity zone I don’t know what they are but when I find out I will share. When we were young we choose the neighborhood because we could afford to live in it.