On Sept. 26, housing policy experts from all corners of the United States came together in Bloomington, Minn., for the 2023 Housing Leadership Summit. The event was organized by Housing Affordability Institute, a housing policy think tank based in Roseville, MN.
The event was filled with discussion on the drivers of housing affordability and inventory challenges across the country, with a specific focus on Minnesota’s issues. A diverse array of experts provided their input on how to address these issues best.
Industry view: challenges require urgent action
A panel of industry experts kicked off the summit by providing their views on the current state of the housing market.
Beth Wanless, regional government relations and public affairs manager for Zillow, outlined how Minnesota is an outlier in housing costs and that housing affordability is lower in the Twin Cities region than it should be.
“In the Twin Cities, there’s a problem,” said Wanless. “Home prices are high, and I don’t think they should be this high.”
Wanless noted that Zillow’s data showed that on the existing home side, home prices in Chicago are $70,000 less than in the Twin Cities.
Jamie Tharp, division president for Pulte Homes, noted that consumer preferences are changing and that current zoning hasn’t kept pace.
“We’re seeing a shift in mindset in the size and functionality of homes,” said Tharp. “In the ’90s, it was ‘bigger it better.’ We’re no longer in that world.”
Tharp said the rise in single-person households and other demographic changes are driving builders to develop newer products that match consumer demand.
Tony Wiener of Cardinal Homes explained how planned unit developments (PUDs) are where affordability is lost.
“If a builder goes to a city with a project like that, they start seeing dollar signs right away,” said Wiener. “I feel sometimes cities use [PUDs] to raise a tax for the community.”
The panel of industry experts agreed that housing demand in Minnesota remains strong, as the state has largely underbuilt for the last 15 years. They also agreed that the workforce shortage is an emerging affordability issue, with builders, developers and trade partners experiencing difficulties in attracting and retaining talent necessary to build homes at the volume needed to rebalance the state’s housing market.
National experts: simple bills make big waves
Several national leaders in housing policy provided insight into what has worked elsewhere in the United States and what lessons Minnesota can take in 2024.
In a panel moderated by Salim Furth of the Mercatus Center at George Mason University, several experts discussed how strong coalitions and simple, clean bills targeted toward a single topic have been the recipe for success in states like California, Montana and Washington.
“Reform on this issue is a process,” said M. Nolan Gray, a California YIMBY. “There isn’t going to be a silver bullet bill. If you look at California, what has been successful there is that we have the understanding that each year we’re going to have to close loopholes, play whack-a-mole.”
“The biggest issue we face is how to take zoning and make it a topic people care about,” said Tanner Avery of The Frontier Institute, which orchestrated Montana’s zoning reform coalition. “What we did was use data to show that zoning really was a part of our affordability crisis.”
“In some states, we’ve had bipartisan support,” said Alex Fernandez, director of advocacy for Alexandria, Virg.-based Vinyl Siding Institute. Fernandez has worked in multiple states to overturn local aesthetic mandates and design requirements. “In others, we’ve simply lacked opposition.”
National voice shares her views
Providing the keynote to the event was Jerusalem Demsas, staff writer for The Atlantic magazine.
Demsas, who has written on the complexity of housing, said what draws her to the topic is how housing shapes who we are as individuals.
“When you start to working on housing policy, you just start immediately realizing all the ways your life has been shaped by all these forces that were invisible to you before,” she said.
Demsas’ work has been followed across the industry as she’s outlined how local opposition to new housing drives homelessness, housing affordability and access challenges.
Closing out her remarks, she touched on how housing policy reform, specifically zoning reform, has become a bipartisan issue.
“If you’re an environmentalist, this makes sense. If you’re someone with free market or private property rights principles, this makes sense,” Demsas said. “This really isn’t that controversial, unless you’re willing to defend principles that are inconsistent with your other privately stated goals.”
State legislators share bipartisan vision of zoning reform
Turning locally, two legislators from Minnesota spoke about Minnesota’s housing challenges and what they hope to see happen in 2024’s policy-centric session.
Despite holding differing viewpoints, Rep. Jim Nash (R-Waconia) and Rep. Larry Kraft (DFL-St. Louis Park) said zoning modernization is on the Legislature’s must-do list.
Kraft says that housing reform needs to be about our values. “Housing is complex,” he said, noting that he aims to introduce legislation in 2024 to tackle the various issues in “bite-sized pieces.”
Nash said that he wants more cities to see that local control of housing isn’t working and that a bipartisan set of legislators are looking at fixing the problem next year.
“Housing is neither a Republican or DFL issue or solution,” said Nash. “This is a Minnesota problem with Minnesota solutions.”
Both Kraft and Nash share a background in local government and said their service as local officials has shown them why state-level housing reform is necessary. Kraft recently served on the St. Louis Park City Council and Nash was mayor of Waconia.
Disclosure: Housing Affordability Institute was founded by Housing Industry News publisher, Housing First Minnesota.