Minneapolis’ bold move to end the racist policy of single-family zoning is paying off year after year. For the past 14 years, the city has surpassed $1 billion in construction value, with half of these projects dedicated to affordable housing. Meanwhile, one of the largest commercial projects is the expansion of Abbott Northwestern Hospital’s Surgical and Critical Care Pavilion, a key development in the Phillips neighborhood.
As part of its 2040 plan, Minneapolis relaxed zoning laws to allow duplexes and triplexes in residential and business areas, promoted denser development near transit, and set building height minimums in high-demand zones. These changes are increasing affordable housing in historically exclusive areas, especially along business corridors, making it easier for people to access housing near jobs and services.
Experts believe these policies help reduce segregation by opening up previously restricted areas. “The most common way to segregate neighborhoods was through zoning laws that limited the types of homes that could be built, like duplexes and triplexes,” said Alex Horowitz, project director for the Housing Policy Initiative at Pew. “Because of the racial wealth gap, that made segregation by race very effective.”
“The reason why this helps perpetuate segregation by race and class is because multi-family housing, particularly in higher income neighborhoods in cities with high housing demand, is often more affordable for people than single-family homes,” said Michael Lens, a professor of urban planning and public policy at UCLA. “Edina, Eden Prairie, and Woodbury — these highest-income suburbs with the nicest schools and the safest streets — are places that are virtually all white.
“They are places where everyone lives in a single-family home, and those single-family homes are extraordinarily expensive by Minnesota standards. That just restricts certain types of opportunities.”
From 2017 to 2022, rents in Minneapolis increased by only 1% while the rest of Minnesota saw a much larger 14% rise in rents. During this same period, Minneapolis expanded its housing supply by 12%, whereas the rest of the state only increased its housing stock by 4%. This growth in housing allowed Minneapolis to keep rent increases low despite rising demand, highlighting the effectiveness of the 2040 plan compared to the state’s suburbs.
Research also shows that increasing multifamily housing construction helps reduce displacement risk and fosters greater racial diversity in communities.
Minneapolis Mayor Jacob Frey acknowledged the city’s two-pronged approach to tackling the affordable housing crisis: increasing supply and supporting demand. “We’re subsidizing deeply affordable housing while also boosting overall housing supply, whether market-rate or affordable,” he said.
In 2017, people in Minneapolis had to earn 80% of the area’s average income to afford the typical rent. By 2023, that amount dropped to 66%, meaning housing became more affordable for people, even though rent prices went up in other parts of the Midwest.
We’re continuing to invest in publicly subsidized housing, and it’s gratifying to see these efforts pay off,” said City Councilmember Jamal Osman (Ward 6). “Buying a home can be tough, but through these policies, we’re making it easier for people to stay in Minneapolis.”
Indeed, census data shows that Minneapolis gained Black residents from 2017 to 2022. Because rent growth in Minneapolis was 13 percentage points lower than in the rest of the state, renters are paying an estimated $1,700 less per year than if rents had increased at the same rate as in Minnesota overall. This makes it more likely that families of modest means can remain in the city.
“So going back to over the last couple of decades, we see that big cities like New York, Los Angeles, Chicago and Boston have all lost Black residents during that time period, mostly because they weren’t building enough housing,” Horowitz said, pointing out a broader trend in major U.S. cities. “And that meant that we saw increased competition for scarce homes, because there weren’t enough for everybody until all of those cities lost Black residents.”
Half of these projects are dedicated to affordable housing, demonstrating the city’s commitment to addressing housing inequities, according to Karla Henderson, CEO of Project for Pride in Living. “Our project helps address housing inequities and ensures more families have a place to go home,” Henderson said.
Minneapolis’ continued focus on creating diverse, affordable housing is a powerful example of how policy change can promote inclusivity and address historical inequities. Despite increasing demand for housing, the city has managed to keep rent growth in check, indicating that expanding the housing stock can directly help keep housing more affordable.
Despite progress, Minneapolis continues to face significant housing challenges, including homelessness, and critics argue that more needs to be done. In 2023, a series of proposals, including a 3% rent control policy and changes to zoning laws, were opposed by Mayor Frey.
Since the city shifted to a “strong mayor” system in 2021, Frey has used his expanded powers to block these measures, which were pushed by the progressive wing of the City Council. A vote was held on Eid al-Adha, a religious holiday for many of the city’s Muslim council members, leading to their absence during the critical vote.
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