Leading The Charge on Affordable Housing and Economic Development

Duluth is facing many challenges, including housing vacancy and affordability which has a disproportionate impact on low- and moderate-income households. More than half of Duluthians who rent are paying more than they can afford for housing, which impacts the capacity of businesses to attract employees to the community. Housing availability and affordability are directly related to economic development.

A Neilsberg Research analysis of US Census data compared Duluth to MN cities with populations exceeding 50,000 residents. Duluth ranks 18th out of 19 for median household income, falling almost to the bottom in household income range among all large MN cities.

It’s no surprise then that a recent study by the Harvard Joint Center for Housing Studies indicates nearly 1 in 3 Duluth renters are severely cost-burdened, spending more than 50% of their income on housing costs. Using data compiled by the Census and the American Community Survey, 32.2% of Duluthians are spending 50% of their income on housing, and 50.5% of renters are cost-burdened by spending 30-50% of their income on housing.

“According to the study, average rent sat at $950 a month, while the average renter household’s income was just above $27,800. Sumair Sheikh, executive director of LISC pointed to an example of someone who said a 250-square-foot studio which they had rented for $425 in 2017 is now going for $950 in 2024.”

John Cole points to the analysis of affordable housing in 2019 by Maxfield Research, which identified a need of 3,500 additional units in affordable multi-family housing. (To see the full study, visit https://duluthmn.gov/media/9677/city-of-duluth_update-of-aff_workforce-hsg-need-final.pdf). Housing units being constructed are primarily at market rate prices and therefore cater mostly to professionals who have found above median income employment in our city.

Even so, our health care employers, St. Luke's and Essentia Health, continue to discuss the need for affordable and workforce housing to support their expanding employment bases. The need for housing to serve low- and moderate-income households remains strong, particularly for those taking lower wage jobs in sectors with growing employment opportunities.

At Chum, 41% of those on the wait list for subsidized housing have been there for more than two years. There are simply not enough housing units available, and the number of people living unhoused continues to rise. St. Louis County reports a 41% rise in overall homelessness and 157% rise in chronic homelessness in the ten years from 2013 – 2023.

Duluth community leaders are struggling with funding allocation decisions that involve economic development and affordable housing. The City Council has previously allocated funds to the HRA of Duluth, and our City Administration has asked them to reallocate some of the same funds to economic development. Councilors are split on this issue, which will come up for a vote again at their May meeting.

Please visit https://www.chumduluth.org/advocacy and click on the “Advocate for Better Housing Today” button for more information and how you can influence housing in Duluth.

If you would like to see more like this, please join Chum’s Advocacy Team to receive updates and action alerts! Sign up here: https://www.tfaforms.com/5119818