Market Watch Issue #7: The Northland Region

Across the state, the growing ranks of renter households are facing an increasingly challenging housing market with rising rents and declining vacancy rates. Current owners of unsubsidized rental properties have few tools to preserve and improve aging properties to maintain homes for current and future tenants. In this research report, Minnesota Housing Partnership (MHP), in partnership with Greater Minnesota Housing Fund, tracks key trends in the unsubsidized multi-family rental markets of the Northland (Arrowhead) Region.

Building on our 2016 “Sold Out” report, Minnesota Housing Partnership launched a new research series tracking key trends in the unsubsidized multifamily rental markets across the state.

This seventh report, published in May 2021, analyzes data for 6,449 unsubsidized rental units in properties with four or more units in the Northland Region from the CoStar database.

View a webinar on the Northland Noah report, featuring a report overview from MHP Research Manager Gabriela Norton and a community panel discussion with Daryl Olson of the American Indian Community Housing Organization (AICHO), Pam Kramer of LISC Duluth and Isaac Meyer of KOOTASCA Community Actionhere.

Download the full report.


Highlights from Issue #7: The Northland Region


Naturally occurring affordable units clustered in Duluth and along the Iron Range

Thousands of households earning under 60% of the area median income (AMI) — for instance, a family of four earning under $50,400 annually — are able to call the Northland region home by renting in unsubsidized apartments in the private market. Unsubsidized units that are affordable to these residents are often referred to as naturally occurring affordable housing


In total, 41% of units in our dataset contain apartments that are affordable to those earning under 60% of AMI. By number, Duluth, Grand Rapids and Cloquet contain the most units affordable to families earning less than 60% AMI in the region.



Low vacancy rates mark a tight market for cities with more naturally occurring affordable units

When vacancy rates fall below 5%, renter households struggle to find affordable housing. Property owners can be more selective in tenant screening and potentially increase rent. Vacancy rates have dropped in eight out of ten cities with the most NOAH, thus constricting supply of available affordable rental homes.

Multifamily, market rate housing is aging in the region

The Northland region has some of the oldest multifamily, market rate housing in the state, with over one third of these buildings older than 100 years. Aging housing is more vulnerable to repair concerns and may need significant reinvestment to be maintained as healthy, safe homes.


Renter income is lower than the state average in every county in the Northland Region, and cost burden is pervasive

With the statewide average renter household income of $37,686, renter households in the region earn significantly less than that.  In the top five most populous cities in the Northland region, median renter income is 35% (in Duluth) to 91% (Grand Rapids) lower than that of the median renter income of the state. In total, half of renter households (16,259) experience cost burden in the region, spending more than 30% or what they can afford on rental housing costs.  Additionally, 69% of all renter households in the region earn under $50,000 annually.

Market-rate new construction has been consistently minimal in the past twenty years, further compounding access to affordable housing

Compared to the rest of the state, the Northland region has seen very little new construction in the past ten years. We tracked a total of 15 multifamily properties that broke ground from 2010 to 2019; of those, just four were affordable. The majority of these properties were low-mid rise, with an average of 78 units.


Download the full report.

Data analysis, writing and mapping for this report was conducted by Gabriela Norton, Research Manager at Minnesota Housing Partnership, with design by Andy Birkey, former MHP Director of Communications & Research. Questions about data? Contact inquiries? Contact jenny.jones(at)