New MHP report looks at rural rental properties and the residents that call them home

A new report by MHP describes important affordable rural rental properties across Minnesota and the people who live there.  

In communities across Greater Minnesota, rural rental housing is at risk due to declining investment and failure to construct new housing affordable to community members. — and MHP is working with partners and communities to save it (Learn more about our technical assistance here).  These are rental units that have been financed under the USDA’s Section 515 program. Under 515, nonprofit and for-profit entities have received 1 percent loans for acquisition, rehabilitation or construction of rental housing and related facilities. 

Many rural rental homes are aging and in poor condition. As federal investments in the 515 program have been insufficient and declining for many years, many 515 properties are in declining condition and there has been no new construction for years. 

As loans for these properties expire, more and more buildings are exiting the Section 515 program. Exiting properties may lose rental assistance funding, and some properties are no longer required to keep rents affordable — meaning residents could face displacement or homelessness. 

These properties are often the few rental homes in rural communities that are affordable to extremely low-income residents, seniors, and people with disabilities. The loss of these properties will be especially acute for communities already struggling to provide affordable homes. 

Part of the effort to save these properties is to quantify and describe these properties and who lives in them. MHP, in collaboration with the University of Minnesota’s Center for Urban and Regional Affairs, analyzed the most recently available data. The result is this report 

Among the findings:  

  • Minnesota has 456 properties under the 515 program providing 9,667 affordable rental units and housing 13,435 people.  
  • Average annual income for residents of these properties is $17,061.
  • These properties are found in 82 of Minnesota’s 87 counties but are concentrated in central and southern Minnesota.  
  • Significant age of the properties, indicating a need for regular maintenance and potentially poor conditions.
  • Households are more likely to be headed by women and are more likely to be BIPOC.