Steele County Housing Coalition proposes ideas to address housing crisis – Southernminn.com

More than two dozen community members from around Steele County gathered both virtually and in-person to hear about the ongoing affordable housing crisis in the Owatonna area. 

The Steele County Housing Coalition hosted a Housing Summit Tuesday at Riverland Community College in Owatonna for community members to gather and discuss potential affordable housing solutions in Owatonna and Steele County.

The Steele County Housing Coalition is a grassroots organization that was formed as a result of the Owatonna Forward listening session in the community. Members of the coalition are dedicated to addressing the housing shortages in Owatonna and the whole of Steele County, specifically in regards to affordable housing.

John Patterson, director of planning research and evaluation for the Minnesota Housing Finance Agency, spoke to trends in housing, not just in Steele County, but the state. He talked about the severe shortage of affordable housing that continues to be problematic in Minnesota as a whole and Steele County.

“Right before and during the years after the Great Recession, we were grossly under producing housing,” Patterson said. “We were needing 20,000 to 25,000 units and we were down to 10,000. This created a severe housing shortage. This is why we have really low vacancy rates and why, when you try to find a home to buy, it is snatched up right away.”

Patterson went on to say that, for renters, availability is trending in the right direction as far as the forecasted data he and others at the Minnesota Housing Finance Agency had available. However, for potential homebuyers, there is a larger issue.

He said, ideally, in a balanced market, there would be five months worth of inventory available at any given time. However, the market has consistently been below that with an average of just a one month supply of inventory.

“I think, with the pandemic, there’s some weird things happening,” Patterson said. “People are doubling up or moving in with family to be able to afford the inflating prices.”

With home and rent prices steadily increasing and inventory remaining relatively low, Patterson said this will only continue and there is an “obvious need” to increase single family home production in order to stabilize the market.

Karina Schmitz, of the Steele County Housing Coalition said the need for affordable housing in Steele County is apparent. She said there are more than 3,500 households in the whole of Steele County that are considered “cost burdened”. This means that more than 30% of their income is being dedicated to housing expenses, including rent or mortgage payments and utilities. About 1,500 are considered “severely cost burdened” meaning more than 50% of their income goes towards housing expenses”. Both of these pieces of data do not include those considered to be homeless.

“Rental and mortgage prices went up, while wages went down,” Schmitz said. “Weird things are happening as a result of the pandemic, and we’ve all felt that, but in the housing world, it’s been skyrocketing for issues.”

Schmitz spoke about the need for affordable housing in Steele County and discussed what some neighboring communities are doing to combat their shortage of affordable housing and taking creative approaches to ensure the needs are met.

She then turned the attention to three focus areas the coalition has identified to benefit Owatonna and Steele County to increase the availability of affordable housing by 90 units over the next five years.

This is a small amount when we think about it,” Schmitz said. “Ninety units before 2025 is a small amount, but we have to start somewhere.”

For the first focus area of supportive and transitional housing, it was recommended to identify, purchase and renovate 15 foreclosed homes for emergency needs and transitional housing, as well as construct an additional 15 multi-family units to address short-term housing needs.

Secondly, the senior housing market in the Owatonna area is a concern according to Schmitz. Ideally, they would like to renovate 15 senior owned homes to allow for the process of aging in place and construct 15 senior housing units that also allow for lateral market movement. And finally the addition of affordable workforce housing. It was proposed to purchase and renovate 15 multi-family units in Steele County that are in need of repair and to also construct 15 two-bedroom, one-bath single-family starter homes in Steele county.

Following the presentation, attendees were invited to break away into several groups to discuss and brainstorm possible causes and solutions to the ongoing issues surrounding affordable housing. 

“We want to make sure that everybody is aware. If you’re not dealing with housing every day, it might be something you just read about or hear about once in a while,” Schmitz said. “It’s important to see that these things are happening all around us, and it’s a matter of what we can do best to address it.”