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Twin Cities Multifamily
YOUR MULTIFAMILY INVESTMENT GUIDE
Twin Cities Multifamily
YOUR MULTIFAMILY INVESTMENT GUIDE
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Recap Of The Affordable Housing Summit

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panelToday I had the pleasure of attending the Minnesota Real Estate Journal's 10th Annual, Affordable Housing Summit.

There were lots of great speakers and important topics discussed.

A couple of takeaways (in no particular order)

  • Book recommendation - Homelessness Is A Housing Problem, How Structural Facotrs Explain U.S. Patterns - Gregg Colubnr, Clayton Page Aldern
  • NIMBYism is a persistent issue.
  • The Twin Cities is 103,000 housing units short for people that are in need the most affordable housing. (I might not have written down this stat exactly so please fact check)
  • As the state and local authorities considers how to address affordable housing it should do it's best to target programs and policies rather than making blanket rules and regulations that have unintended consequences and aren't efficient or effective. 
  • Even organizations that are designed to meet the state's affordable housing needs are not immune to market forces such as increased security costs, insurance costs and debt costs
  • While the overall Twin Cities vacancy rate is low - some Minneapolis (Uptown) property owner's are experiencing 10% vacancy rates. They can only lower the rent so much. Resident's are not turning down the properties due to affordability issues but rather quality of life issues.slide
  • Although the eviction moratorium has ended, some affordable housing operators still have hundreds of non-paying residents. With an estimated turnover cost of an evicted unit at $12,000 - $15,000 they are bracing themselves for huge expenses in 2024.
  • A social contract has been broken. Even though landlords are the ones harmed when resident's don't pay rent - many times they will be silent because they become the "bad guy" for complaining about this injustice. The actual issue is people feeling empowered to not pay rent. The housing system is broken.
  • We need to re-legalize housing! We wouldn't be able to build the cities that we have under today's regulations. - Policy makers need to slow down on "solving housing." There have been so many new regulations in recent years that we haven't had time to monitor the results. Currently we are operating in chaos.
  • Turnover of on-site staff is up at alarming rates. Many positions have seen multiple turnovers in the same year. This speaks to both the complexities of the business the stress of meeting unrealistic expectations and the challenges of working with the client base.panel 2
  • Real Estate is inherently political. Local, state and national policies are shaping real estate.
  • Building codes are constantly changing, becoming more complex and causing building costs to increase
  • Climate / efficiency standards are a huge reason for increased costs.
  • In these tough times our skills will be tested
  • At least we're not in the Office market.

Somewhat of a sobering presentation. I hope that our legislators and policy makers are paying attention to these discussions.

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