Although home building in the Twin Cities soared last month, the Star Tribune reports the double-digit increase in permits was to build entry-level townhouses and rental apartments. Permits to build single-family houses were down, compared to last year, and suggests rising construction costs and mortgage rates are affecting the local market in Minnesota. Executive director of Housing First Minnesota David Siegel told the news source that the combination of rising rates and workforce shortage are an ongoing challenge for the industry.
During September homebuilders were issued 482 permits to build 1,277 units, according to a monthly report by the Keystone Report for Housing First Minnesota. That was a 15 percent decline in total permits, but a 69 percent increase in planned units from a year ago.
Only 444 of those permits were to build single-family houses, 19 percent fewer than last year, and permits to build townhouses increased 60 percent. Six permits were issued to build 674 units, mostly upscale rentals.
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