Minneapolis Housing Reform Tackles Affordability: Key Results from Minneapolis 2040 Plan

Housing Affordability Crisis in the U.S.

These days, it isn’t easy to locate an inexpensive house in the US. According to the National Association of Realtors, the typical sale price of an existing home has increased by 3.1%, despite the average 30-year fixed mortgage declining by nearly a half percentage point over the past year. Although it has generated much debate, a Minnesota initiative may hold the answer to solving the issue.

The first significant American city to do away with the single-family exclusive zoning in 2019 was Minneapolis, which allowed developers to erect multifamily structures on lots formerly occupied by single-family homes. The city allowed developers to mix up the types of developments throughout different areas, including units intended for affordable housing, through a plan known as Minneapolis 2040.

Other revisions in the plan included doing away with parking regulations and giving preference to designs that benefit those who use public transportation, walk, and ride their bikes.

We aim to provide more than one family with affordable housing if we are to build it. Minneapolis Mayor Jacob Frey, who has been in charge of the Minneapolis 2040 plan, stated, “We want to house five, six, eight, or twenty-five families.” “We’re making a wider range of housing options possible.”

Both former president Donald Trump and Vice President Kamala Harris have made general promises to help first-time homebuyers; further information is available from the Harris campaign. In order to alleviate the housing affordability crisis, Harris and her presidential mate, Governor Tim Walz of Minnesota, propose to construct 3 million new houses. Karoline Leavitt, the national press secretary for the Trump campaign, attributed the rise in housing expenses to both the policies of the present administration and an “unsustainable invasion of illegal aliens.”

The campaign stated that reducing restrictions and releasing federal land for development are key components of Trump’s housing proposal. Thursday, July 20, 2023: The Currie Commons housing development is being built in Minneapolis, Minnesota, US, in the Harrison neighbourhood. A regional initiative that includes revised zoning regulations has resulted in a rise in rental units in the Minneapolis area. Minneapolis 2040 was passed five years ago, and according to Frey, “the results speak pretty clearly for themselves.”

Rising Home Prices and Mortgage Rates

According to a Pew Research analysis, the city’s housing stock increased by 12% between 2017 and 2022 the start of the Minneapolis 2040 plan while the state’s growth was only 4%. Despite being the most populous county in the state, Hennepin County, where Minneapolis is located, is the second-easiest county to buy a home compared to the seven counties nearby, according to an NBC News measure of home buying difficulty.

Minneapolis: A Zoning Revolution

It seems like the pump is ready for more homebuilding. After examining 50 years’ worth of Minneapolis building permits, Ryan Allen, an urban planning professor at the University of Minnesota, discovered that developers have been requesting permission to construct in the city at a rate 2.5 times higher than the average for the previous five years. According to Allen, developers’ interest and confidence in this local home market is evident from their actions.

The goal remains to lower the cost of living in the city. Additionally, early indications indicate that Minneapolis’ housing plan coincides with lower rentals, even though various factors, including amenities, the local economy, cultural considerations, and migratory patterns, influence market rates for a home.