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The Way Out of the Housing Crisis: How Minneapolis Stabilized Rents

Original Illustration by Larisa Kachko '26

This piece was produced in part with the financial support of the Stone Inequality Initiative. The Brown Political Review maintains editorial independence over all columns and stories published.

In 2021, 32 percent of American households reported being “cost-burdened” by housing. That number jumps to almost one in two when focusing solely on renters. As evidenced by soaring urban home prices, Americans want to live in high-density cities with easy access to communal institutions, employment, and other public amenities. Unfortunately, high-density cities have consistently failed to meet the demand for housing, jacking up prices. These high costs take a toll: Unaffordable housing makes it increasingly difficult for newly working adults to find homes and contributes to the displacement of low- and middle-income residents. What’s more, high-density cities are consistently shown to emit the least carbon on a per-resident basis, particularly when there is a strong public transit system that enables residents to live largely car-free. Thus, making moving to high-density cities financially viable would help not just Americans but also the climate.

Minneapolis, Minnesota, a growing American metropolis, has largely solved the problem of housing unaffordability. Thanks to a sweeping set of 100 policies implemented at the start of 2020 known as the “Minneapolis 2040 Plan,” rent prices in the city have stabilized in the face of population growth and inflation—and despite higher housing prices throughout the rest of the state.

While these policies touch on everything from street lights to soil health, the plan’s multifaceted approach included four particularly crucial reforms: eliminating parking minimums; creating density minimums near public transit stations, with higher standards near popular transit hubs and even higher ones downtown; abolishing single-family zoning; and increasing investment in various affordable housing projects, both public and private.

None of these pieces on its own is a silver bullet, but in concert, the four policies have demonstrated remarkable success. These initiatives, when enacted nationwide, could be a promising antidote to perpetually inflating rent prices. 

The most intuitive solution to the housing crisis is to build more affordable housing. However, although solely building more affordable housing certainly helps renters with low incomes, it has a negligible impact on the cost of housing writ large. A study done in Alexandria, Virginia, for instance, found that affordable housing construction increased local property values by 0.1 percent. As prices continue to spiral out of control, without an imminent increase in the total urban housing supply, no one but the most wealthy will be able to afford market-rate homes. And, without densifying cities, that increase can only come from continued suburban sprawl, eating away at the country’s natural environment. The starting point of any housing policy, therefore, has to be creating more market-rate housing units in the city center.

One simple way to encourage urban construction is to eliminate parking minimums, which Minneapolis did in 2021. This means that, while developers are free to add as many parking spots as they see fit, they are not legally obligated to meet a certain number. This is an increasingly popular reform across the country, as localities slowly reconsider the necessity of mandating parking quantities. Larger cities like San Francisco have also eliminated their minimums, while New York City, Buffalo, Cincinnati, and others have reduced their parking requirements. The elimination of these requirements is key to promoting affordability because parking minimums increase the price of construction and prohibit many forms of dense land use; to that end, a 2016 study found that the imposition of parking minimums increases rents by 17 percent. 

Moreover, parking minimums exacerbate the climate crisis. Both surface parking lots and massive parking garages—shoehorned into city centers by parking minimums—turn huge areas of valuable real estate into unproductive concrete rectangles while encouraging increased dependency on cars. One study found that the median American city dedicates 26 percent of its land to automobile storage, with some cities approaching a whopping 50 percent. Eliminating parking minimums—with an exception for individual handicapped spots—and allowing developers to only build the parking they deem necessary is an easy change that lowers housing costs, improves the urban environment, and helps mitigate emissions. 

Dovetailing with the removal of parking restrictions is the Minneapolis 2040 Plan’s special focus on increasing housing density near high-use transit corridors. Increasing the appeal of public transportation is crucial not just for environmental reasons (traveling a mile via public transportation more than halves the emissions from driving the same distance) but also because public transportation is most efficient and economically sound when it serves a large ridership. To make, for instance, a train line a central component of municipal infrastructure, it must act as the primary means of transportation for a sizable portion of the population. Additionally, it is easier to increase housing density when citizens live car-free, as private automobiles take up far more physical space than their lower-emission, public alternatives. Transit-oriented development has also become a major method through which lawmakers at all levels of government have fought urban sprawl, a process that devours local ecosystems and wastes vast amounts of resources. 

This part of the plan’s package, however, does have analogs in other states. A 2022 statewide bill in Massachusetts requires localities to implement density minimums near public transit hubs, and a similar proposal is in the works in Connecticut. The desire to increase density near public transportation spans the political gamut—liberal megacities like Los Angeles and conservative suburbs like Lehi, Utah alike are researching how best to achieve these shared goals. Policymakers have finally started to realize that promoting density near public transit hubs not only increases the supply of housing but also expands the demand for public transportation, helping ensure its lasting viability—all without requiring a cent of government spending.

On the other hand, among the boldest changes in the package was the complete legalization of duplexes and triplexes coupled with the abolition of single-family zoning. “Multiplexes”—homes that service more than one family—had previously been disallowed in 70 percent of Minneapolis. Single-family zoning is the widely adopted practice of forbidding the construction of multi-unit homes or apartments, permitting only large, unattached houses on separate lots. This policy has a long, racist history in the United States, largely designed to keep housing prices high and thus exclude poor and minority populations from many communities. As America adopted anti-discrimination laws, explicitly racist language was dropped from the provisions, but the pernicious effects of single-family zoning persisted. Allowing “gentle density” by taking the ax to single-family zoning is an important component of both building cities of the future and rectifying wrongs of the past. 

Lastly, the city redoubled its efforts to promote affordable, below-market-rate housing. It is directing rental assistance toward lower-income residents, keeping existing stock in place by extending the duration for which affordable units have to be kept below the market rate, and expanding the stock of publicly owned homes. These are important components of any housing affordability plan, as even stabilized prices can remain out of reach for those at the bottom of the economic ladder. Affordable housing works in conjunction with the aforementioned policies to stretch the purchasing power of each public dollar, creating a massive boon to the economy. In fact, the average affordable housing development recoups the public investment necessary to construct it with a 230 percent return in local economic activity on each dollar spent. Purely deregulatory solutions, like many of the others mentioned, are not enough to fix this crisis. Public investment is an essential piece of the equation.

Minneapolis has boldly shown a way out of ever-increasing housing prices with a handful of relatively simple policy improvements. These changes—incorporating the removal of exclusionary red tape in parking mandates and zoning codes combined with active spending to fill gaps—should serve as a model to the rest of the country trapped in the rent spiral. Prices show that Americans want to move into city centers, lowering carbon emissions along the way. It is past time to allow them to do just that.