Issues:

The Housing Crisis in Duluth

Funding Affordable Housing

Latest Endorsement:

Neighborhood District #9

The Housing Crisis in Duluth

What is affordable housing?
Housing is considered affordable when total housing costs (including utilities) do not exceed 30% of a family's income. This is particularly critical for low-income families (who make 80% or lower of the Duluth median income) who do not have the additional resources to absorb these high costs. In 2000, over 26% or 8,569 households in Duluth spent over 1/3 of their income on housing. Approximately 42% of renters in Duluth currently live in substandard or unaffordable housing.

How do we know there is a shortage of affordable housing in Duluth ?
There are several indicators that point to a crisis in affordable housing in Duluth

According to the recent Rental and Vacancy Rate Survey conducted by the City of Duluth Community Development Department. The rental housing vacancy rate in Duluth continues to be below what is considered healthy. Although vacancy rates have been getting closer to the healthy 5% vacancy rate (as of September 2004 it was 4.8%), rates for units between $600 and $900 a month continues to hover at a low 3.8%. Rents over the last year increased by 5% pushing the average cost of a two bedroom apartment up to $754 a month. A single parent of two would need to earn over $17.00 an hour at a full time job in order for this rent to be affordable.

Homelessness is on the rise in Duluth. The largest shelter in the city, operated by CHUM (Churches United in Ministry), reported an increase of 31% from 2000 to 2001. The number of homeless children they served in that time period rose by 38%. These numbers have remained at this level since then.

Waiting lists for subsidized housing are extremely long. Over 1,200 people who qualify for subsidized housing in Duluth are waiting for assistance from the Housing and Redevelopment Authority. Subsidized housing would lower these families' housing costs to 30% of their incomes.

Why is there a shortage of affordable housing in Duluth ?
There are many factors which contribute to the lack of affordable housing in Duluth :

Very little new housing is being built. The City of Duluth reported only 146 new construction permits were issued in 2003, and this is for all types of housing, not just affordable.

Affordable rental housing is an unattractive investment for landlords, construction costs are expensive, and government programs to subsidize the costs of these units were phased out in the 70's and 80's.

There is a gap in affordable home ownership opportunities. In the past seven years the median home sales price in Duluth has increased by 50%, with wages increasing only slightly.

Last is the NIMBY (Not In My Back Yard) syndrome. As developers have sought to build affordable housing developments in Duluth , it has been contested by people who express concerns about the changing face of their neighborhoods.

Funding Affordable Housing / Expanding the Pie

A variety of different funding sources exist to develop affordable housing in Duluth, these include:

Housing 1000 is currently working to develop a variety local funding streams to help leverage existing sources of money for both affordable housing as well as supportive housing. Affordable housing developers and advocates are coming together to design innovative solutions to provide safe, affordable and supportive housing for Duluth.