Close to home: UND student tackles housing affordability in Grand Forks
UND senior Matt Sorenson recently sat among the expansive roll-down maps of a classroom in the the university's department of geography and geographic information science.
The unfurled maps depicted the usual major landscapes—North Dakota, the U.S., the world at large—but Sorenson, a student of geography and economics, was more focused on the small maps before him which detailed an issue far closer to home.
Sorenson and his adviser, UND geography professor Enru Wang, had recently completed a housing study of the city of Grand Forks through a grant program administered by the university's College of Arts and Sciences. The research probed specifically the matter of housing affordability, a subject long examined by city leaders and something the geography researchers found scarce in the city of Grand Forks.
While the study treaded some ground that had been walked before, Sorenson was happy to have done his part in bringing the research to light, especially as an undergraduate student.
The process involved with moving through a heftier paper is more intricate than "just a small thing for class."
"With something like this, it's not just a few pages where you start and go until you hit a page minimum," he said with a laugh, pointing to his 23-page report.
As far as geography, Sorenson said the study was a real-world application of skills he'd learned in an academic setting, particularly GIS systems and data visualization tools.
Sorenson said he and Wang tackled the subject through a variety of data points.
"We had an overview of the market in terms of different characteristics: vacancy rates, number of family versus non-family homes, median income and affordability," Sorenson said, ticking off a list of metrics. "Then we compared that with different, similarly sized cities in the region."
Income a factor
That sample pool included the North Dakota cities of Fargo, Bismarck, and Minot, as well as Sioux Falls, S.D., and Rochester, Minn.
In order to determine home affordability, the researchers pulled data on median income levels, home values and other demographic information from the U.S. Census Bureau and its yearly American Community Survey estimates. Affordability was determined by dividing home values by annual incomes. Median housing prices equal to or less than three times the level of median annual income were considered affordable, while amounts greater than the threefold mark were deemed unaffordable.
Using that index, Sorenson and Wang determined Grand Forks, Fargo and Sioux Falls to be "very unaffordable." Within that set, Grand Forks was deemed the least affordable city at an affordability index of 3.55. Fargo was a the closest runner-up with a value of 3.3. Sioux Falls was the closest to affordable at 3.05.
The remaining cities of Bismarck, Minot and Rochester were all deemed affordable, with respective values of 2.94, 2.92 and 2.57.
The UND housing study isn't the first to point to barriers within the Grand Forks housing market. A study presented to the Grand Forks City Council in August indicated the average price of a home in the city has risen by 23.3 percent since 2012. In the four-year-period before that, the average cost of a home rose by about 6.6 percent.
While wages were also increasing over that time, they couldn't keep pace with the housing market. Since 2009, the inflation-adjusted median income in Grand Forks increased by an estimated 4 percent, from $48,500 to a projected $50,500 in 2016.
Sorenson said the earnings side was a vital part of the city housing equation.
"The interesting thing is that housing in Grand Forks isn't too ridiculously expensive," he said. Rather, Sorenson added, affordability was skewed by low incomes. The city's 2014 median income of $44,134 was the lowest seen in the data set. In that same year, the median income for the state of North Dakota was $55,579.
Of the cities studied, Grand Forks and Fargo shared characteristics that set them apart from the rest of the group. Beyond their status as North Dakota's largest university towns, the two were also the only cities where rental homes, as opposed to home ownership, made up the majority of the housing market. They were also the only two cities where the non-family households made up the majority.
Sorenson noted the populations of both cities were influenced by the presence of large universities and youthful—often low-income—student residents.
Moving forward, he intends to pursue a master's degree in business geography, a field where the methods used in his research paper will come in handy.
"This showed me another great use of geography, and it was fun to be able to work with the city I'm living in and be able to find something out for a prominent problem, as availability goes," Sorenson said. "If we're not getting the answer, then we're at least pointing in the right direction through our study."