ARPA Funding Injects $4.2 Million into College Park’s Housing Market

The American Rescue Plan Act (ARPA), enacted in 2021, provided state and local governments with resources needed to respond to negative public health and economic impacts of the COVID-19 pandemic. These funds were allocated to local governments across the country in an effort to promote community resilience.  

The Community Preservation Trust began acquiring single-family homes in the summer of 2023, supported in part by a $3 million grant through the City of College Parks’ ARPA Coronavirus State and Local Fiscal Recovery Funds (SLFRF) program. By December of 2024, the Trust successfully utilized all ARPA grant funding to purchase and sell six single-family homes to new College Park residents. 

COVID-19 Squeezes College Park’s Housing Market 

The COVID-19 pandemic intensified competition in the housing market for several reasons. Reduced availability of labor and building materials slowed the development of new homes, further straining an already competitive market. More recently, rising interest rates have significantly increased housing costs. More recently, rising interest rates have significantly increased housing costs. Just a few years ago, 30-year mortgage rates were below 3%; today, they have more than doubled, exceeding 7%. Many current homeowners with low-rate mortgages are hesitant to sell and take on a mortgage with much higher rates, further limiting the supply of available homes. 

College Park— a city of 35,000 residents and home to the University of Maryland’s flagship campus with over 40,000 students—serves as a microcosm of these housing challenges. Located in the heart of the D.C. metro area, College Park has faced significant housing appreciation, limited new residential construction, and the typical issues associated with town and gown communities—such as access to education, transportation, services, entertainment, and employment. Addressing these challenges has been a consistent and continuing area of focus for College Park residents and ultimately led to the creation of the Community Preservation Trust. While university towns naturally experience housing pressures, the COVID-19 pandemic exacerbated these issues, further narrowing opportunities for those looking to purchase a home in College Park. 

ARPA Funding Impact Summary 

The Trust is committed to creating a legacy of affordability, stability, and empowerment for future generations, despite the hyper-competitive housing market in College Park. Since 2023, six single-family homes have been purchased using a $3 million ARPA grant from the City of College Park. These homes were renovated as needed, staged, listed on the open market, and sold to income-qualified households with minimal cost burdens. On average, households that purchased these homes spend approximately 25.8% of their annual income on principal, interest, taxes, and insurance, making homeownership accessible and sustainable. 

Additionally, the Trust generated $1.2 million in sale proceeds from the settlement of the six homes. These funds will be reinvested into purchasing additional properties, further advancing affordable housing efforts in College Park. 

Conclusion

While the lingering effects of the COVID-19 pandemic continue to impact economic activity at local, state, and federal levels, the Community Preservation Trust and other community land trusts (CLTs) provide innovative tools for addressing housing affordability challenges nationwide. The impact of ARPA funds extends far beyond the initial investment, ensuring these homes remain affordable for generations to come. 

Read more about the Trust’s 2024 activities here. For more information about the Community Preservation Trust, visit our website.