SAUK RAPIDS – Property developers, stakeholders, and city and county leaders came together for the long-awaited study on Benton County’s housing infrastructure May 24 at The Clearing in Sauk Rapids. The study showed that the county has a lack of places to live, especially for senior citizens, renters and those looking for single-family houses.
Key takeaways from the study, according to Matt Mullins of Maxfield Research and Consulting, which is the company Benton County hired a year ago to conduct the housing study, includes moderate population growth in the county over the last decade. The vast majority of growth is led by millennials and baby boomers, or those born between 1981 to 1996 and 1946 to 1964, respectively.
Mullins also reported that the unemployment rate in Benton County is lower than it was pre-pandemic, but he said labor force participation remains down. There are many job openings but fewer workers to fill those positions, which can make staffing senior housing a deterrent to constructing a much-needed housing demographic.
Senior housing and standard rental vacancies in Benton County are at 6.2% and 1.5%, respectively – figures Mullins said are “dangerously low.” Mullins said there is pent-up demand for new rental housing. Not only are rental vacancies at a critical shortage, but there is also lack of availability of residential lots.
The housing study resulted in a wealth of data that Mullins hopes elected leaders use as a tool for policymaking as well as a tool that will attract developers. The study showed Benton County is ripe for construction. However, the state of the economy may deter developers from choosing Benton County for their projects.
For example, former state representative and current government affairs director for the Central Minnesota Builders Association Steve Gottwalt said the issue at hand is not what the data says but rather the regulatory environment in the state. Mullins said it takes, on average, $100,000 more to build an average home in Minnesota than it does in neighboring states.
“When you are $100,000 into a parcel of land before you build a house on it, before you turn a spade of dirt – that’s before material costs, before interest rates, before labor costs – that’s a problem,” Gottwalt said.
Gottwalt said fees are a major deterrent to building low-cost, affordable homes. Gottwalt said most people view $250,000-$275,000 as an affordable house, and neither investors nor families are going to build an affordable house when a lot costs close to a half or a third of the house to develop.
“If the cost just to play is so high that nobody’s going to play, then you’re never going to build the houses you need,” Gottwalt said. “The state, county and local units of government all need to start thinking seriously about how to reduce the burden on the cost of building houses.”
Gottwalt hopes government units do their part when it comes to easing the financial burden on developers and families to get them into Benton County, and Benton Economic Partnership Executive Director Amanda Othoudt agreed.
Othoudt said regulations like housing density and, potentially, outside-the-box solutions like allowing accessory dwelling units could benefit the county.
“Now that this housing study is done, those conversations are what we need to have with individual communities in order to tackle the bigger picture,” Othoudt said. “We need to involve all communities together to continue conversations about housing.”