Since the Opportunity Zone program does not come with any restrictions with respect to rents and/or people who live in the Opportunity Zone properties, investors who make substantial new investments or improvements to the properties, will set the rents at levels that provide them with adequate financial returns, Damani tells GlobeSt.com.

If current median gross rents rise by approximately 30% as a result of construction/renovation activity under the program, about 80% of the Opportunity Zone census tracts would become rent burdened, explains Damani.

Interestingly enough, the Center on Budget and Policy Priorities believes the Opportunity Zone program could essentially amount to a “subsidy for gentrification” in many areas instead of providing the housing and jobs for low-income communities.

“Our models show that in order for investments to be financially viable, subsidies and incentives must be provided to developers to keep the rents affordable and prioritize affordable housing,” says Damani.

According to the SP Group, by mid to late 2019, relatively affluent areas designated as Opportunity Zones will be the first to get flooded with capital as soon as Treasury issues the pending guidance. The truly disadvantaged communities will take more effort at the federal, state and local levels to attract investor funds. Hopefully, it says, there will be more focus on preserving affordable housing in the challenged areas included in the Opportunity Zone program.

“We anticipate that rents are not going to decrease when properties are “substantially improved” to meet the conditions necessary to be considered Opportunity Zone properties. Upward pressure on rents will likely increase public pressure on local governments to address affordable housing issues,” says Damani.