ST. PAUL, Minn. – A new report released Monday by the Minnesota Housing Partnership shows that more than a quarter of Minnesota households spend more than 30 percent of their household income on housing costs.
Among Minnesota renters that number is nearly a half of such households.
From 2000 to 2015 the median rent of a two-bedroom apartment in Minnesota increased from $779 to $848, an increase of nine percent. The median household income in Minnesota fell nearly $4,000 in that time, a total of 11 percent. The median income renter can afford $815 of rent per month, but the market rate for a 2-bedroom apartment is $924 per month.
Homeowners are also seeing increasing costs and declining incomes. The median cost of a home in Minnesota increased by 11 percent from 2000 to 2015, nearly $18,000. The median household income for homeowners decreased by one percent.
“Safe, stable, affordable housing is essential to accessing opportunities in our economy, schools, and state,” Lt. Governor Tina Smith said in response to the report.
Smith used the report as an opportunity to stump for Governor Mark Dayton’s jobs bill. The bill includes $114 million of new funding for affordable housing programs.
Lower-income households have been hit the hardest. In households with an annual income under $20,000, 84 percent of renters and 78 percent of homeowners spend more than one-third of their income on housing. From $20,000 to $34,999 those numbers are 69 percent and 48 percent respectively.
The report classifies a “severe renter cost burden” as affecting households which spend more than half of their income on housing. Twenty-three percent of Minnesotans who rent their homes fall under this category.
New housing construction fell off sharply from 2004 to 2008. Both owner-occupied and multi-family housing units have seen some recovery since 2011, the low point for each category. The number of multi-family units constructed in 2015 was higher than any time since 2000. The owner-occupied constructions recovered slightly, but 2015 saw less than one-third as many built as in 2003.
“Historically, Minnesota has been recognized as a national leader for its commitment to helping families with affordable ownership and rental homes,” Chip Halbach, Executive Director of the Minnesota Housing Partnership said, “But much more needs to be done to keep pace with the growing need for affordable housing that we see across the state.”