Uncategorized

New construction housing in and around St. Paul is rare and expensive. Builders who want to make a profit build them large and expensive.  The limited number of homes for sale continues to drive up housing prices. Normally we could build our way to a more affordable housing market. The supply of homes for sale could be increased by building more houses.

According to the non-profit Housing affordability Institute 

A third of the cost of a new home in the Twin Cities comes from regulation and local policy.

Even without the added cost of all those regulations the price for new construction is unaffordable for most.

The study also concluded that “The Metropolitan Council’s growth boundary is unique to the region and has resulted in significantly higher land prices inside the established line. In concert with municipal land decisions, a land shortage has emerged which has a rationing effect in key areas, driving up prices. Land inside the Metropolitan Council’s growth boundary can be 3.8-12.8 times more expensive than comparable land outside of the boundary. In cities around the country that do not have urban growth boundaries, we do not see these kinds of price discrepancies.”

“State-level regulations, including the administration of federal rules, also affects affordability. Recently enacted state-level regulations in Minnesota have added more than $13,000 in costs per home.”

Regulatory costs make building permits more expensive. There are a lot of fees bundled into the permit.

 

The number one cause of homelessness is a lack of affordable housing. Once a person becomes homeless keeping or getting a job becomes much more difficult. There are camps all over the city where people live in tents even in the winter.

There was and maybe still is a large homeless camp just below the cathedral along the freeway.

There are camps in the woods along the river unless the river floods. There are abandoned sleeping bags, tents, and clothing in parks and near the camps. Sometimes people camp at the boat landing near downtown.

According to a report and action plan from the Interagency Council on homelessness, there are some groups of people who are more likely to become homeless than others and the number of people who are 55 and older who are homeless is rising rapidly along with the number of young people who are homeless. There are disparities based on race and people become homeless as a result of domestic violence. You can find the report here.

Here are some statistics from the Interagency Council on Homelessness

As housing costs continue to rise faster than wages the problem may grow. Home builders have been saying for years that they can not build affordable housing and make a profit. Most new construction housing is very expensive.

I am not sure if it is the answer but we lack micro apartments and of course, local zoning laws prohibit tiny houses.

People do not make the best decisions right after s divorce or a death. Rebound real estate can end up being the most expensive real estate of all.

Right after the holidays, I start getting calls from people who want to move. For some of them, the move will be because of a divorce or a break up with a partner. They wait until after the holidays and then begin making plans.

Some will want to buy another house. I call it a rebound house. Please think before you buy the rebound house because it is the home purchased shortly after a divorce or the break-up of a long term relationship. The rebound homes that are purchased don’t always work out in the long run. Go out and rent an apartment and give yourself a year or so before buying real estate.

During breakups, people often look at their move as moving away from something or someone. It might be best to think in terms of moving toward something like a new life. Where do you want to be? Where do you see yourself in five years? If there is no mental picture then making a long term commitment like buying a home is not the best choice.

I have listed homes for a few people who bought the home shortly after a break-up. In each case, they felt they owned it for a short time and felt they had made a mistake. They did not look at enough homes, they got themselves in over their heads financially, or they just paid too much for what they bought because they wanted to get on with their lives and in their haste failed to do their homework.

Buying a home is a big step, please wait until you are ready to make a good decision.

It is Friday and Fridays are for fun. The holiday season was a little rough at my house. We had a death in the family and then a week later our dog crossed the rainbow bridge. There is more but Fridays are for fun. . . .

There was one highlight for me over the holidays and that is when I went shopping on Christmas Eve and I liked it. I went to a Rosedale Mall. I’ll admit it has been a few years since I have shopped in a mall. It was fun to look in the shops and see things I have never seen before. I bought some jewelry, candy, and sweaters to give as gifts to my family and friends.

I also enjoyed the moose at the mall. There is just something about a giant moose, especially one that doesn’t poop.