1031 Exchange in Altoona MSA
The Altoona MSA offers affordable 1031 exchange opportunities with cap rates around 7.5-9.2%, property taxes at 1.57%, stable healthcare and government employment, and median home prices of $129,950 in Pennsylvania's historic railroad city.
Population
120,269
Key Industries
Healthcare, Government, Tourism
Table of Contents
Information is for educational purposes only. Consult qualified professionals for specific advice.
Local Tax Considerations
Property taxes, transfer taxes, and local incentives
Property Tax Rates
Average Rate
1.57%
Assessment Method
Assessed Value (Pennsylvania Property Tax System)
MSA rate (1.57%) vs State average (1.41%)
+11% above state average, +54% above national average
Transfer Taxes & Fees
Transfer Tax Rate
1% state transfer tax
Pennsylvania realty transfer tax plus local transfer taxes may apply
Local Tax Incentives
Opportunity Zone Investment
Limited state tax benefits for investments in designated opportunity zones
Eligibility: Properties located in designated Pennsylvania Opportunity Zones
Historic Preservation Tax Credits
Tax credits for qualifying historic property rehabilitation
Eligibility: Properties listed on National Register of Historic Places
Local Economic Development Programs
Property tax abatements and incentives for qualifying improvements
Eligibility: Commercial and industrial property improvements meeting criteria
Opportunity Zones
Number of Zones
2
Key Locations
- Downtown Altoona
- East Altoona
Opportunity Zones offer significant tax benefits for long-term investments, including deferral and potential elimination of capital gains taxes.
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Market Profile Dashboard
Economic indicators and market trends
Population
120,269
Growth: -0.3% annually
Median Income
$60,594
Unemployment
3.3%
Job Growth
+0.8% annually
Economic Drivers
Market Trends
Median Home Price
$129,950
Average Rent
$900/mo
Cap Rates
7.5-9.2%
Demographics
Median Age
42.9 years
Bachelor's Degree+
18.2%
Owner Occupied
71.8%
Property Type Analysis
Investment opportunities by asset class
Single-Family Rental
Strong value investment opportunity with stable demand from healthcare workers, government employees, and tourism workers.
Market Metrics
- Cap Rates: 8.2%
- Vacancy Trends: Moderate vacancy around 8-10% due to population decline but stable employment
- Demand Forecast: Stable demand supported by healthcare employment and tourism, offset by population trends
Risk Factors
- Population decline and outmigration trends
- Limited economic diversification
- Aging housing stock requiring maintenance
- Competition from homeownership market
Opportunities
- Healthcare employment stability
- Government sector employment
- Tourism and heritage market growth
- Affordable entry prices for investors
Multifamily
Good value opportunities with diverse tenant base from healthcare workers, government employees, and service workers.
Market Metrics
- Cap Rates: 7.8%
- Vacancy Trends: Higher vacancy around 10-12% due to declining population and rental demand
- Demand Forecast: Cautious outlook due to population trends but supported by employment stability
Risk Factors
- Declining rental rates and population
- Competition from single-family rentals
- Limited new household formation
- Economic dependence on healthcare sector
Opportunities
- Healthcare worker housing demand
- Government employee rental market
- Value-add opportunities in older properties
- Tourism worker seasonal housing
Industrial
Limited but stable opportunities supported by healthcare, manufacturing, and transportation sectors.
Market Metrics
- Cap Rates: 9.2%
- Vacancy Trends: Moderate industrial vacancy around 8-10% due to economic transition
- Demand Forecast: Stable demand from existing employers but limited growth potential
Risk Factors
- Economic transition from manufacturing
- Limited industrial growth potential
- Transportation infrastructure limitations
- Competition from larger Pennsylvania markets
Opportunities
- Healthcare facility expansion
- Tourism and heritage industry support
- Regional distribution and logistics
- Manufacturing support services
Office
Limited opportunities with government and healthcare demand offset by economic constraints and remote work.
Market Metrics
- Cap Rates: 8.5%
- Vacancy Trends: Higher vacancy around 15-18% due to limited economic growth and remote work trends
- Demand Forecast: Stable but limited demand from government and healthcare tenants
Risk Factors
- Limited economic growth and expansion
- Remote work reducing office demand
- Competition from newer facilities
- Aging downtown office stock
Opportunities
- Government tenant stability
- Healthcare office demand
- Professional services growth
- Historic preservation and adaptive reuse
Neighborhood Spotlights
Up-and-coming areas and investment hotspots
Downtown Altoona
Historic downtown core with government offices, cultural attractions, and railroad heritage sites
Investment Thesis
Stable rental demand from government workers and tourism employees, opportunity zone benefits, and historic preservation potential, though limited growth and aging infrastructure.
Median Price
$115,000
Price Growth
+5.2% YoY
Rental Yield
9.1%
Days on Market
28 days
Key Highlights
Development Pipeline
Historic preservation projects and downtown revitalization efforts
East Altoona
Residential area with mix of single-family homes and affordable housing options
Investment Thesis
Value-oriented rental market with working-class demographics and affordable entry prices, though economic sensitivity and population decline challenges.
Median Price
$125,000
Price Growth
+6.8% YoY
Rental Yield
8.7%
Days on Market
25 days
Key Highlights
Development Pipeline
Affordable housing initiatives and infrastructure improvements
Sixth Ward
Established residential neighborhood with historic homes and tree-lined streets
Investment Thesis
Stable rental market with professional tenants and historic character, though higher maintenance costs and limited appreciation potential.
Median Price
$145,000
Price Growth
+4.1% YoY
Rental Yield
7.8%
Days on Market
22 days
Key Highlights
Development Pipeline
Historic preservation and neighborhood stabilization
Juniata
Industrial and residential area near historic railroad shops and facilities
Investment Thesis
Industrial worker housing demand with railroad heritage appeal, though economic transition challenges and limited growth prospects.
Median Price
$110,000
Price Growth
+8.2% YoY
Rental Yield
9.5%
Days on Market
30 days
Key Highlights
Development Pipeline
Heritage tourism development and industrial site redevelopment
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Compare Markets
See how this MSA stacks up against others
Compare Markets
| Metric | Altoona (Current) | Johnstown | State College | Williamsport |
|---|---|---|---|---|
| Population | 4.0M | 4.0M | 4.0M | 4.0M |
| Median Property Price | $750K | $750K | $750K | $750K |
| Average Cap Rate | 5.2% | 5.2% | 5.2% | 5.2% |
| Job Growth Rate | 2.1% | 2.1% | 2.1% | 2.1% |
| Rental Yield | 4.8% | 4.8% | 4.8% | 4.8% |
| Days on Market | 25 | 25 | 25 | 25 |
Frequently Asked Questions
Common questions about Altoona 1031 exchanges
Altoona offers high cap rates of 7.5-9.2%, affordable entry prices with median homes at $129,950, stable healthcare and government employment, and railroad heritage tourism appeal. The market provides value-oriented opportunities in Central Pennsylvania.
Railroad heritage drives tourism through attractions like Horseshoe Curve National Historic Landmark and Railroaders Memorial Museum. This creates employment in tourism, hospitality, and related services, supporting the local rental market.
Yes, the region has 2 designated Opportunity Zones including downtown Altoona and East Altoona. Pennsylvania offers limited state-level opportunity zone benefits compared to federal benefits.
Property taxes are moderate at 1.57% effective rate, above the national average of 1.02% but below some other Pennsylvania markets. The affordable property values help offset higher tax rates.
Altoona faces population decline, limited economic diversification, and outmigration trends. However, healthcare sector stability, government employment, and tourism provide economic anchors for value-oriented investors seeking higher cap rates.