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Rents on the rise: Report says renters in NM facing affordable housing crunch

BEMIDJI—A common difficulty for northwest Minnesota residents is finding affordable rental housing, according to a new report from the Minnesota Housing Partnership.

More than 14,320 people in the northwest region likely have to sacrifice other needs, such as food and medicine to pay for rising housing costs, the report states. Of the seven regions in the state, the MHP reports the northwest region has experienced the highest challenge in median gross rent since 2000, with rent increasing by 18 percent.

Mahnomen, Red Lake and Pennington counties all experienced an increase of more than 25 percent, while Lake of the Woods County saw a 36 percent rise in rents.

Beltrami and Polk counties, with populations centers such as Bemidji, Crookston and East Grand Forks, saw a 17 percent increase, but that also translated into the counties experiencing the highest rates of housing cost burden in the region. A total of 47 percent of all renter households experienced financial challenges because of the cost of rent.

The northwest region had 190 new multi-family units permitted for construction in 2015 according to the MPH, yet nearly half of them were built in Beltrami County and the others in Pennington and Roseau counties. Nine of the 12 counties in the region, saw no development.

For Tim Flathers, executive director of the Headwaters Regional Development Commission, the report falls in line with what's taken place at the local level in the Bemidji region.

"I think Bemidji has a pretty healthy market, where there's still units being built and there are those for sale. But the costs of construction continue to increase, quicker than people's incomes are increasing. That's especially true with lower incomes," Flathers said. "So, even in an area with a healthy market, the low and moderate income folks tend to still be left behind."

For smaller communities, Flathers said the main issue is the lack of overall housing availability.

"If you look at Blackduck as an example, they have Anderson Fabrics, which has a lot of jobs available and they could use more workers, but some can't find a place to live," Flathers said. "The cost of construction, though, are pretty significant and the risk to build a 20- or 30-unit complex in a place like Blackduck is a lot greater than building one in a larger city."

In response to the issue, Flathers said there is legislative activity taking place in St. Paul that could improve the situation. For example, Flathers said some additional tools could be provided to support affordable housing through the Low Income Housing Tax Credit Program.

Flathers said there's also been discussion about creating local housing trust funds at the Legislature. This would mean the state could designate funds to local municipalities for them to use at their own discretion based on their markets.

"For state groups, one thing many of them are focusing on is workforce housing," Flathers said. "There are places that are interested in increasing their employment base but don't have adequate places for people to live. It's becoming a critical issue statewide."

Here's a look at some other statewide trends in the report, which can be found at:

•" target="_blank">mhponline.org/publications/housing2017

• Statewide, the MPH reports more than 1 in 4 households, nearly 550,000 families, spend more than 30 percent of their income on housing, resulting in likely cutbacks on other necessities like food, education and medicine to pay for their rent or mortgage.

• Despite the renting population in Minnesota increasing by 11 percent the past 15 years, the report says rent has risen 9 percent while the median income for renters has fallen 11 percent.

• Since 2000, MPH details the number of cost-burdened renters increasing by more than 30 percent and that it now impacts nearly half of all renter households in the state.

• According to the MPH, 56 percent of all senior renters in the state are cost burdened, a 25 percent increase since 2000. Additionally, the number of cost burdened senior homeowners has also increased 54 percent since 2000. In the next 20 years, the MPH estimates the population of Minnesotans older than 65 is anticipated to grow by 93 percent, making senior housing a critical issue.

• Homelessness, meanwhile, has declined 9 percent from 2012 to 2015, the MPH states. However, more than 9,300 Minnesotans, including nearly 3,500 children, were homeless on a given night in 2015.

Increase in median gross rent, by region, 2000-2015

• Northwest: 18 percent increase; $582 median rent

• Central: 18 percent; $731 median rent

• West Central: 17 percent; $611 median rent

• Northland: 15 percent; $594 median rent

• Southwest: 15 percent; $649 median rent

• Southern: 14 percent; $658 median rent

• Twin Cities: 8 percent; $982 median rent

• Statewide: 9 percent; $848 median rent

The Northwest region includes the counties of Beltrami, Clearwater, Hubbard, Kittson, Lake of Woods, Mahnomen, Marshall, Norman, Pennington, Polk, Red Lake, Roseau. Cass County is in the Central region.

Matthew Liedke

Matthew Liedke is the city, county and state government reporter for the Bemidji Pioneer. He also covers business, politics and financial news.

(218) 333-9791
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