As North Dakota’s 68th Legislative Session begins, we are preparing for housing discussions with state legislators. North Dakota Housing Finance Agency’s (NDHFA) goals for this session are driven by the findings of the 2020-2025 Statewide Housing Needs Assessment. While the assessment shows that North Dakota’s economy is strong, our unemployment rate is low, the state is growing and we have adequate housing options, there are issues that limit North Dakota’s ability to take advantage of economic opportunities.
North Dakota’s housing stock is aging, more than 50% of housing units were built before 1979 and require significant rehab or replacement. Our largest projected population increases are concentrated in extremely low-income to lower-income households, the population with the greatest housing cost burden. More baby boomers are moving into the 65 plus age category and this population that will continue to grow for the next 20 years. Finally, constraining affordability is the combination of increased home prices and rising interest rates.
Over the past 10 years, North Dakota has seen median rents increase by 49%, more than twice the rate of inflation, and the average home’s sales price has risen 51%. Meanwhile, incomes have only increased 41% over the past decade, putting significant pressure on household budgets. The assessment indicates approximately 9,000 new housing units need to be built by 2025 to meet demand. The ability to produce this housing affordably is constrained by construction costs, labor shortages and, in rural areas specifically, a lack of contractors.
To address these constraints, Gov. Burgum recommended $25 million be allocated from North Dakota’s Legacy Fund earnings for the Housing Incentive Fund. We support the governor’s recommendation and hope the legislature agrees that housing is an important part of the state’s workforce recruitment efforts, and the agency’s work to ensure all our residents have the safe and affordable housing needed.
The governor’s other recommendations includes the transfer of the North Dakota Homeless Grant and the Emergency Solutions Grant from Commerce to NDHFA, better aligning these programs with our agency’s current homeless program offerings. With the population growth projected in the extremely low-income category, it’s vital that North Dakota has proper support services and housing options available for households who could potentially experience homelessness.
NDHFA is also proposing to increase the funding for our Helping HAND and the Rehab Accessibility Program. These programs help lower income households address safety and accessibility concerns. The resources provided by NDHFA allow such households to remain in their homes, which is typically their preference, and reduces the cost of services provided by other government agencies.
We urge you to contact your legislators and let them know the importance of housing to the state and for your community, and ask them to support NDHFA’s housing goals.