Steve Furlong works in mortgage financing in Bloomington and, on the side, owns a few rental properties he uses to help people build credit and savings to be able to buy a house.
For years, his daily commute took him past a couple of vacant lots at Penn Avenue and 86th Street that he thought would be the perfect spot for some townhomes or apartments. Eventually, he bought the two properties and in fall 2019 told neighbors and city officials about his plan to build 15 units of affordable housing, the subsidized kind that can be sold or leased at below-market prices.
It was the start of an odyssey that has only now brought him to the point of going to market.
“The most important thing is finding a way to create more home ownership opportunities and working to bring everybody to the table, because it does take a village,” Furlong told me as I visited him at the site where he was putting up his first sign marketing what he’s calling Penn Lake City Homes.
“Now we’re working to market the site so we can get at least a handful of interested buyers before we sink $8 million into building it,” he said.
Furlong’s experience shows that, even with most of the people involved doing the right things at the right time, it takes huge amounts of patience and persistence to get new housing built these days.
That’s difficult because the state’s housing shortage is becoming more acute. There were fewer than 9,000 new housing units permitted in the metro area in 2024, about half the number the Federal Reserve Bank of Minneapolis estimates the market needs to keep up with demand.
This demand remains acute even though population growth and economic growth is slow in Minnesota. It’s a market distortion with roots in the 2008 recession, which was triggered in part by an oversupply of housing in other parts of the country. Housing construction plunged in Minnesota at that time and remained below demand ever since.