Rent hikes are the result of tax increases and rising property values, say landlords according a new story in the Star Tribune. Adam Belz reports that new contemporary, luxury-style apartment units are being built by the thousands, and have had a major impact assessed values of other apartment buildings. Higher values, means migher taxes, and therefore higher rents
While Minneapolis’ market value of apartments has more than doubled since 2012, building owners can receive tax breaks should they provide affordable units or develop in a tax increment financing district. For those who do not fall in that category, tax bills have risen drastically.
To find an agreeable middle ground for both renters and landlords, city council members have been hard at work mulling solutions to the raising costs of apartments. Aside from section 8 housing, council members have suggested updating the zoning codes, which would allow for smaller apartment buildings that create healthy market competition and provide for better price control. If Minneapolis is to avoid a renter situation similar to New York or San Francisco, more construction must take place and vacancies must be higher.
The Minnesota Multi-Housing Association opposes all of the possible proposals.
Read more from Star Tribune here.