Roseville, Minn. – Homebuilding activity in the Twin Cities metro slowed in September as persistent affordability challenges, elevated borrowing costs, and broader economic uncertainty put additional pressure on the housing market. Single-family homebuilding activity fell 8% from the same period last year. Homebuilders pulled permits for 580 single-family homes in September.
There were 595 permits issued for a total of 1,107 housing units during the four comparable weeks in September, according to the Keystone Report. Although activity declined compared to last year, this month’s data reflects a typical September pace over the past four years.
“Buyers are being more deliberate in today’s market, and we’re beginning to see that in the pace of new home construction,” said John Kraemer, board chair of Housing First Minnesota. “Affordability and borrowing costs remain real hurdles for many buyers, but the interest in homeownership hasn’t gone away.”
Multifamily activity, however, had another solid month of building activity. Developers reported 527 multifamily units under construction—accounting for nearly 50% of all construction activity for the month.
“High borrowing costs and economic uncertainty are adding pressure in the near term, while our persistent housing shortage continues to drive affordability challenges over the long term,” said James Vagle, CEO of Housing First Minnesota. “Minnesota needs meaningful solutions that allow us to add more homes at a wider range of price points and create more opportunities for people to own a home in the communities they love.”
For the month in permits, Lakeville took the top spot with 65 permits. St. Michael came in second with 34 permits. Rosemount was the next highest with 32 permits. Cottage Grove ranked fourth with 30 permits, and Woodbury rounded out the top five with 28 permits.
For the month in units, Minneapolis led with 292 permitted units. Eden Prairie came next with 196 units, followed by Lakeville with 65 units. Rogers came next with 44 units. St. Michael rounded out the top five with 34 units.
Download the full data chart here.