State housing laws are dead; It’s time for local leaders to step up

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While two statewide bills in Minnesota that would allow for missing middle housing everywhere and denser housing in commercial areas have stalled, local officials remain cognizant of housing affordability issues. Fortunately, they don’t have to wait to take effective and immediate action.

Many cities have traditionally been heavily focused on economic growth, while creating needed housing for workers has been an afterthought. This strategy may have worked in the past, but property prices have become a critical issue. After all, real estate prices in Minnesota are 27% higher today than they were four years ago.

In order for first responders, nurses and teachers, as well as workers like carpenters and plumbers, to live in the cities where they work, cities must provide more housing. Without affordable housing, workers will be forced to move, and without workers, employers will go elsewhere.

The best way to boost housing construction is to unleash market forces by cutting red tape. The best path forward is to allow private individuals to build on smaller lots, reduce parking requirements, or open commercial areas to mixed-use development – measures similar to those proposed in Housing Codes HF 4009 and HF 4010.

To accomplish what has failed at the state level, cities must build a bipartisan coalition around these common-sense housing reforms. Luckily, the message of abundant housing offers something for everyone. For conservatives, supply-side reforms cost no taxpayer money and are entirely market-driven. For environmentalists, building state-of-the-art, energy-efficient buildings in already developed areas prevents urban sprawl. For progressives, repealing laws that intentionally pushed minorities out of their neighborhoods enables greater racial diversity and economic mobility. For the business community, creating more housing expands the commercial base, which can help revitalize commercial cores affected by shrinking family sizes and suburban migration. Not to mention the countless jobs that would be created by building more houses, selling them or taking out loans.

For cities, the prospect of moderately higher density far outweighs the disadvantages. Higher tax revenues from a broader taxpayer base would more than offset any additional infrastructure spending. Furthermore, the new housing infrastructure is estimated to cost only a fifth of new greenfield development because the streets are already paved, the fire stations are already built and the pipes are already laid.

This isn’t just theoretical; Similar reforms have proven highly successful in cities across the country, including Seattle, Houston, Denver and Palisades Park, New Jersey. In these cities, as housing affordability became an issue, the market was able to respond to higher prices by gradually shifting about 2% to housing. of older single-family homes per year into two-family homes or detached terraced houses.

This new steady influx of new housing will accumulate over time and will have many positive downstream impacts such as: B. Providing younger generations with housing options close to amenities to raise a family instead of having to move away. Palisades Park even returned some of the additional revenue to all taxpayers by reducing property taxes.

However, to be successful, cities must properly implement these reforms. Regulations must be as short and simple as possible. Unnecessary regulations will discourage small local developers from building new housing units. In Seattle, for example, an affordability requirement made building townhouses too costly for low-income households, resulting in an 80% decline in townhouse permits. Or in Minneapolis, it is not possible to build semi-detached or triple-family homes, which are now permitted, because of the floor space ratio, which essentially limits the building envelope to a single-family home.

In Minnesota, St. Cloud Mayor Dave Kleis is leading the way as the city considers allowing accessory dwelling units and reforming minimum lot sizes, lot coverage ratios, floor area ratios and other zoning standards.

Housing reformers will inevitably face resistance from those who oppose any form of change and from those who complain that the reforms do not ensure sufficient affordability. They are both wrong. In principle, property rights only apply to your own property, not beyond. And the best solution to address housing unaffordability is to build more market-rate housing. All other solutions, such as those seen in Seattle or the failed rent control experiment in St. Paul, prove this.

Housing affordability will only become a bigger problem for Minnesotans in the future. Fortunately, cities don’t have to wait for the state to address the issue. Local jurisdictions, like St. Cloud, can lead the way by advancing their own common-sense housing reforms.

Tobias Peter is co-director of the AEI Housing Center, a nonpartisan think tank based in Washington, DC, and advises St. Cloud on housing reform.