Affordability is a function of supply and demand, not taking into account government subsidies. St. Paul, along with the rest of Minnesota and most the country, is facing an affordable-housing crisis. There are more buyers than sellers, which has continued to inflate existing home sale prices to record highs, and the cost to build a new home has increased just as fast, as building material costs have increased to record highs. As home valuations increase, more residents are forced to remain in the renter pool. As the supply of renters continues to grow, apartment rents have also remained high, albeit less than existing home prices.
How can we solve the affordable housing crisis? The quick answer is to increase the supply of homes and apartments. Without government subsidies it’s no longer economically feasible to build an apartment complex at a price that can support renters in the sub-50% AMI bucket. Subsidies from municipalities can make this a possibility, which Minneapolis has adopted and implemented. St. Paul, on the other hand, has no affordable zoning requirement and hasn’t allocated in a meaningful way to make multifamily housing affordable. The St. Paul Planning Commission and City Council have fallen behind on the fight for affordable housing in the community.
As the St. Paul City Council works through new allocations to affordable housing and affordable zoning, the only way to potentially alleviate the housing crisis is to approve new construction in the city. Private development moves a lot faster than government regulation, so this is the quickest answer to the housing crisis. Lexington Flats is a project that meets all city zoning requirements, but has continued to face pushback from the Planning Commission and City Council. Neither group has a legal case to block the development, and my belief is that they’re acting irresponsibly in denying new housing for this area.
The City Council failed to be ready for this housing crisis and now are trying to fight back by blocking new development that would add additional supply to the market and alleviate increasing rental prices. It’s a simple function of supply and demand. So I ask the City Council, do you want to continue to look at an empty lot that is used to pile snow up in the winter, or do you want to approve a project that would bring new housing supply to your community that could alleviate the supply constraints and work toward a solution for the housing crisis?
Lucas Whelan, Medina
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Author: Letter Writers