Updated: Jan 7
The Minneapolis City Council has recently approved new ordinances it hopes will solve several issues, from correcting historic racism in housing and the criminal justice system to creating more affordable housing. The goals here are admirable and the council should be commended for its attempt to discuss and address them (“Changes approved in Minneapolis 2040 plan begin to take shape,” Dec. 29).
However, starting with the 2040 Plan and the elimination of single-family zoning, these policies will not work economically for creating affordable housing.
The current median price of a single-family home in Minneapolis is about $282,000. The construction costs, including demolition, lot preparation and new utilities, to build a three-unit building with units averaging 1,200 square feet (the typical size of a new two-bedroom apartment today) would be about $200 per square foot. Add in the costs of buying an existing home, design fees, government fees, legal costs, interest, developer profit, marketing costs and commissions, and the total development cost would be about $300-plus per square foot. These new units, if sold, would each cost $360,000 to $400,000. If rented, the monthly rent would be in the $2,400 range or more, plus utilities.
The 2040 triplex plan may selectively add more density, but it will economically fail in creating more affordable housing.
Read entire opinion HERE.
"New Minneapolis housing policies won't work economically"; By KELLY DORAN; StarTribune Opinion Exchange; January , 2020