Green and Growing
The Minnesota homebuilding market was strong in 2016 and shows no plans to slow down this year as it continues to meet buyers’ needs.
For the past four months, homebuilding activity continues to break 10-year old permit number records in Minnesota. Total permits are up nearly 30 percent from this same period in 2016, while units are up nearly 50 percent compared to last year, according to the Builders Association of the Twin Cities (BATC). The boost can be credited to both single-family and multifamily construction showing production growth, with single-family units up 27 percent compared to 2016 and multifamily units are up 88 percent. BATC notes that 2016 was the best year for the area’s home construction in a decade, so this progress in 2017 is positive.
“We’ve heard great reports of high traffic during our Spring Parade of Homes and that more homebuyers are looking to find their dream home in the community they love,” says Bob Michels, BATC 2017 president. “A healthy housing market includes a variety of options to meet the needs of homebuyers. With resale home inventory tight, we expect to see new construction continue to pick up the pace to meet the demand for housing.”
This demand is due to a number of reasons, but Minnesota REALTORS have found that millennials – predicted to make up 33 percent of buyers in 2017 – are looking for affordability, and Minneapolis is one of the top markets for this generation because of its costs.
Even so, the state needs more entry-level housing. “Strong homebuilding activity is a great sign for all of Minnesota, but our builders are still struggling to create entry-level housing, a key part of the housing market,” says David Siegel, BATC executive director. “We are working with the MN REALTORS this year at the capitol to support a package of common-sense legislative proposals that create opportunities for first-time homebuyers and address the cost-drivers like increased regulation, that make building affordable entry-level housing so difficult.”
The Right Path
Minnesota homebuilders are working hard to reduce homeowners’ overall costs by educating them about energy-efficient features in homes. BATC created the MN Green Path program to help homebuyers understand a home’s expected energy use, as well as provide a green certification program that encourages buyers to choose green features. MN Green Path also provides the Home Performance Report (HPR), which independently documents testing results and green features for a particular home.
During the Spring 2017 Parade of Homes, 64 percent of the homes were on the Green Path Energy Tour, which is a tour-within-the-tour that highlights homes that have been inspected and rated for energy efficiency by an independent Residential Energy Services Network (RESNET) rater and can produce a HPR. One of the Green Path homes on the Spring Parade of Homes was the Artisan Dream Home.
“Located on Lake Minnetonka overlooking Crystal Bay with a sandy bottom shoreline, this home showcases sensational lake views from the floor-to-ceiling windows throughout,” BATC says. “Luxurious features include a second-story deck, a huge office loft, a majestic master suite with 16-foot ceilings and a gorgeous deck and patio – all overlooking the lake. The home also includes a state-of-the-art smart home system, wet bar with a walk-in wine cellar, massive sunken media room, cutting-edge steel staircase, two-story cedar-clad wall and a solar-ready roof.”