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Minneapolis tops $1 billion in construction projects, rent keeps rising

Even with loads of new construction in the Minneapolis area, reports show that it’s hard to afford rental space in Minnesota


There are more apartment buildings and condos going up in Minneapolis than ever before.

According to an October report published by Minneapolis Community Planning & Economic Development, 10,371 building permits have been issued in 2013, totalling to more than $1 billion.

But even with an increase in supply, landlords are still demanding more for rent. In a statement last fall, the Minneapolis Housing Partnership said that the average cost for rent is $979, an average that's increased by 8.5 percent over the last three years.

The most costly project this year was the A Mill Apartment Building Complex, a remodeling job that was valued at $68,060,970. A studio apartment in the space will start at $800 a month - a price that the National Low Income Housing Coalition says is too much.

In 2012, the coalition said that Minnesotans have to make $15.50 an hour to afford a decent two-bedroom apartment, assuming the rent would be around $800. Minimum wage is currently a little more than $7 an hour. The steep price of rent is causing many to spend more than half of their income on housing, reports Minnesota Public Radio, noting that Minnesota is the least affordable state for housing in the Midwest.    

In an article published in the Star Tribune on Nov. 5, reporter Jim Buchta said that there's "growing concern that the rental market is on the verge of saturation," noting that rental vacancy rates are dropping even with new construction on the market.

And the buildings keep coming.

In Minneapolis, the city expects to set a new building projects record by surpassing the 2,000 permit valuation total.

 

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