As the housing market navigates a sea of obstacles, community-level organizations in Minnesota are urging governments to take a closer look at their strategies for supporting older neighborhoods, and said deteriorating homes shouldn't be overlooked.

Construction of new homes continues to lag, in part because of supply-chain issues, and groups such as NeighborWorks Home Partners say there's another problem: plenty of neighborhoods in Minneapolis and St. Paul, as well as surrounding suburbs, have an aging stock.

Beth Hyser, chief program officer for the group, said the scale of funds set aside for things like home improvement loans has not kept up with demand.

"We're seeing more and more folks trying to age in their homes," Hyser observed. "But because of a variety of financial situations have not been able to keep up with maintenance."

She added there are many first-time homebuyers who cannot afford to take on debt for necessary repairs. Community partners worry it will lead to more issues like gentrification, with private investors buying up properties.

Hyser recommended state and local governments do all they can to access funds through the federal HOME program, noting it offers flexibility in buying or rehabbing affordable housing.

Jim Erchul, executive director of Dayton's Bluff Neighborhood Housing Services, said they see a lot of older residents staying in homes with maintenance needs piling up. He explained it prevents them from being able to sell. His group can help facilitate options, but there are barriers.

"The state has a good, deferred loan program for extremely low-income folks, but it's rather burdensome to administer," Erchul noted.

Erchul pointed out a client and a community organization could spend a lot of time seeking approval, only to see it fall through. He suggested creating more efficiencies and expanding eligibility for the program, while still allowing for accountability, could go a long way in seeing their aging housing stock get the attention it needs.

Both groups say full renovation costs have skyrocketed, and smaller investments over time can prevent a collection of neighborhood homes needing major overhauls at once.

People cannot be denied a place to live based on their race or disability in Michigan, but some are being turned down based on where they get the money to pay their rent.

Veterans using assistance, retirees on Social Security, parents who get child support or families who use housing vouchers are not protected by anti-discrimination laws. All can be denied rental opportunities even though they have consistent income.

Nora Ryan, supervising attorney for Michigan Legal Help, said such restrictions defeat the purpose of housing vouchers, which are supposed to allow people greater access to homes and neighborhoods, but the vouchers are often difficult to use.

"You have a relatively short period of time to be able to place that voucher," Ryan explained. "A lot of landlords do not accept those vouchers. You can actually run out of time to use that voucher, and you can lose it. That ticket to stable, affordable housing is cut off."

In the Michigan Legislature, Senate Bill 205, Senate Bill 206 and Senate Bill 207 would prohibit source-of-income discrimination, and allow renters who are turned down the right to seek "remedies for the discrimination" if they can prove they suffered a loss as a result. The idea was first introduced in the 2021 session, and is still in committee this year.

Jim Schaafsma, housing attorney for the Michigan Poverty Law Program, said he is keeping an eye on the U.S. debt ceiling battle in Congress as well. He worries if money for federal housing programs does not increase based on the rate of inflation, vouchers and other types of assistance could be jeopardized.

He noted Michigan's state legislation will not be enough to help the overall housing situation.

"What we need is a significant increase in the supply of affordable housing in Michigan," Schaafsma asserted. "But even more specific to the voucher program, what we need are what are known as higher payment standards because the higher the value of a voucher, the better the opportunities are for families to rent units in the place of their choice."

Adding urgency to the problem, rent for a typical home in the Detroit metro area has increased by nearly 36% in the past five years, according to Zillow's March 2023 Rental Market Report.

Rent for New Mexicans has increased 70% since 2017, while wages have only grown by 15%, which is one factor pushing more people into homelessness.

The state's Legislative Finance Committee reviewed a report this week, which showed nearly half of renters are cost-burdened and pay more than a third of their income on housing.

Kathleen Gygi, program evaluator for the Legislative Finance Committee, said new data showed the state's emergency shelter capacity has more than doubled in the past seven years, while the supply of affordable rental units has declined by 50% since 2020.

"Homelessness increased by about 48% last year over the year before," Gygi reported. "In addition, rising housing prices and lack of supply of housing units has increased the number of low-income New Mexicans who cannot afford their rent."

There are almost 4,000 homeless people in New Mexico after nearly a decade of declines. Gygi acknowledged while emergency shelter capacity has increased, especially in Albuquerque -- the state's largest city -- moving people into permanent housing has proved to be more difficult. She noted cost-burdened low-income residents face a high risk of losing shelter.

According to the report, January's "Point-in-Time" count of sheltered and unsheltered people experiencing homelessness showed there were plenty of beds available at many shelters across the state, but only about 50% were utilized.

Amy Whitfield, housing and homelessness adviser to the governor's office, said more work needs to be done to find solutions.

"We don't know the numbers that tell us exactly what to build, where to build it and how to build it," Whitfield pointed out. "We've got a lot of different ideas that say we need more permanent supportive housing, we need more multifamily housing. We don't really know for sure how much of that we need and which communities we need it in."

Last year the New Mexico Coalition To End Homelessness estimated about a quarter of those experiencing homelessness were coming from outside of state.

A housing discrimination case in North Dakota dealing with occupancy standards has resulted in a settlement, and advocates say it underscores the challenges families face in maintaining stable housing when access is scarce.

The High Plains Fair Housing Center announced this week Affordable Housing Developers Incorporated has agreed to pay $100,000 over a claim from a working mother from Mandan. The woman, who did not want to be publicly identified, said she was forced to vacate her townhome after updating her lease to note the recent birth of her fifth child.

Nicki Green, intake director for the High Plains Fair Housing Center, said the developer's standards were too restrictive.

"This woman and her children had a three-bedroom unit and the max that was allowed there was five people per household, and this was a 1572-square-foot townhome," Green explained. "This is a big unit."

Green pointed out federal recommendations allow for more flexibility, and the family's living situation did not violate any city codes. The agreement was issued by the U.S. Department of Housing and Urban Development. The complex was not a HUD property, but the developers did receive federal funding. As part of the settlement, leadership with the development group denies engaging in any discrimination.

Green emphasized there is a ripple effect stemming from a case like this, noting the family, which had always paid its rent on time, was uprooted to Fargo because the situation forced the mom to get a new job there.

"It was really hard for the family, it was really hard for the kids," Green recounted. "The kids didn't understand, they didn't know why they had to move suddenly, and it felt for them like a message that they weren't welcomed there."

In 2020, the North Dakota Housing Finance Agency issued a report, which highlighted affordable housing shortages within the state.

Green noted the Mandan case does not send a good message when North Dakota is trying to recruit residents to fill jobs.

"Losing access to housing means you lose access to community, jobs, good schools," Green added. "We want families of all sizes and types and in all neighborhoods, we want that to be the norm."