Duluth is gearing up for a major housing project called Incline Village. This new development will be the largest in the city’s history, with plans to build 1,300 market-rate apartments and condos. The site chosen for this project is special because it overlooks Lake Superior and used to be where Central High School stood. Construction is set to begin this summer, and when it’s done, it will offer amazing views and much-needed housing.

Duluth’s Housing Needs Are Growing

In 2019, the city of Duluth commissioned a study to understand how many new homes were needed. The study revealed that between 2019 and 2024, the city would need to build 3,600 affordable housing units to keep up with demand. But affordable housing isn’t the only need. Since 2019, the city has added 1,183 housing units of all types, but it’s still not enough. According to Noah Hobbs, who works for One Roof Community Housing, Duluth is still far behind. Even though Incline Village will help by adding 1,300 new homes, they will be built slowly over seven to ten years.

A Surprising Housing Shortage

It might surprise some people that Duluth has a housing shortage, especially since the population hasn’t grown much. In fact, between 2000 and 2020, the city’s population only changed by 110 people. But there’s a shift happening in the age of the population. There are fewer young people under 19, while the number of people aged 20 to 34 is increasing. These are the ages when many people start looking to buy homes. Because of this, Duluth needs more housing now than it did in 2000. And while some homes were lost due to a hospital expansion, there hasn’t been a significant decrease in overall housing because of demolition.

Challenges in Building New Homes

Building new homes in Duluth isn’t easy. Two big challenges are the high interest rates and rising construction costs. This is a problem across the country, not just in Duluth. But Duluth faces some unique issues. The city doesn’t have many large general contractors, and there isn’t much land available for new housing. This makes it difficult to build enough single-family homes to solve the housing shortage. According to Hobbs, Duluth also lacks the multifamily housing options that other cities in the region have.

Financial Help for Builders

To encourage more housing development, Duluth is offering financial incentives to builders. For the Incline Village project, the city council approved a $25.8 million subsidy to help get the project started. There’s also a possibility that the project will receive tax-increment financing in the future. However, to build even more housing projects, Duluth will likely need to provide additional financial support.

This project is a big step for Duluth, but there’s still a lot of work to do to meet the city’s growing housing needs.