Multifamily housing leads the way
A new Metropolitan Council MetroStats report indicates robust home building in the Twin Cities region in 2016, though new construction remains below homebuilding in the decades before the Great Recession. See the full MetroStats report, Strong Residential Construction in the Twin Cities Region in 2016 (5 pages, pdf).
Leading residential construction in the seven-county region is the City of Minneapolis, which issued 2,700 permits, out of the region’s total of 13,695 new permits in 2016.
Permits for multifamily housing on the rise
Multifamily housing, including apartments and condos, remains the dominant housing type of the region's new residential construction.
In fact, the share of multifamily housing, as a percentage of new housing, is expected to continue to grow.
The Council expects, between 2010 and 2040, 70 percent of the anticipated 370,000 new housing units will be multifamily and attached housing.
Housing affordability remains a challenge
For the Twin Cities region, and most other large and growing metro areas in the U.S., there is strong demand for housing. Meeting growing demand will require much higher levels of construction of all housing types to mitigate rising sale prices and rents, which are increasingly out of reach for moderate-income households.
As economic conditions improve, more renters may look to buy homes, only to find the availability of moderately-priced "starter" homes is too limited, or that mortgage financing requirements put loans out of reach, keeping them in the rental market until more supply is added or lending conditions improve.
Listen to Council Research Manager Libby Starling describe where new residential construction is occurring.