Statement available at www.housingaffordabilityinstitute.org/housing-shor...

Report Conclusion:

Encouraging new construction and removing barriers to affordability will be essential to sustaining Minnesota’s growth, competitiveness, and appeal for future generations.

Without policy intervention, the housing shortage is unlikely to resolve on its own.

The long-term consequences of sustained housing unaffordability threaten the state’s long-term economic competitiveness.

$9 Billion in Lost Economic Activity

$5 Billion Cumulative Loss in Personal Income

62,932 MN Jobs Not Created

At the same time, housing permits are plummeting.

Statewide, permits are down 35% 2021-24.

In Minneapolis-St. Paul, permits are down 35% 2021-24.

The housing shortage is 4.5 years of permitting activity statewide, and more than 5 years in MSP.

Housing scarcity squeezes the rental market and undermines future homeownership opportunities as renters struggle to save money to move from renting to homeownership.

The severe shortage in new home construction is driven by its region-leading high cost of construction.

The supply-demand imbalance cascades into the existing home market, which is also the highest cost in the region.

In 2024, Minnesota’s homeownership had its largest decline in homeownership in four decades. This was the second-highest decline in homeownership in the U.S last year.