Katrina Tax Breaks Pay for Luxury Condos

Incentives for rebuilding are buying $1M units in Tuscaloosa, 200 miles from coast
By Janice Eisen,  Newser User
Posted Aug 13, 2007 9:56 PM CDT
Richard Loth boards up his home in Pass Christian, Miss., Tuesday, May 22, 2007. His house made of poured concrete is one of the few left standing near the beach. Progress in rebuilding after Hurricane...   (Associated Press)
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(Newser) – Investors are using federal tax breaks designed to stimulate rebuilding after Hurricane Katrina to buy luxury condos being built near the University of Alabama’s football stadium, 200 miles from the coast, the AP reports. The Tuscaloosa developments, where units go for up to $1 million, are flourishing while much of the region devastated by the storm is still in ruins.

One real estate agent said Gulf Opportunity Zone tax benefits were responsible for 10% of condo sales in barely-damaged Tuscaloosa, where units feature granite countertops, huge bathtubs, and even ’Bama decor. GO Zone breaks are expected to cost the government $3.5 billion by 2015. Said a flooded-out local businessman in Slidell, La., “The GO Zone? What’s that? We’re in the dead zone.”