Transit-oriented development (TOD) is a planning strategy that promotes high-density, mixed-use (residential and commercial) development centered around public transportation services. Focusing development in the vicinity of public transit increases potential ridership and fare revenue while also generating less automobile traffic and household transportation costs for the new development. While TOD can improve access and mobility, if demand outstrips supply of new transit-oriented housing, prices will increase, which poses the risk of gentrification. As a result, some governments use equitable TOD (ETOD) to make transit areas more inclusive, and they treat affordable housing as a core part of that work.  

This is the sixth installment in Eno’s continuing series on how metropolitan areas across the country pursue TOD work, including how agencies coordinate across housing, land use, and transportation, what tools they use, and what barriers they encounter on affordable housing and transit policy.  

This week: Minneapolis-St. Paul (The Twin Cities) 

Issues in Housing Affordability 

At first glance, homeownership in the Twin Cities appears relatively attainable among ten selected metropolitan areas—according to data from the National Association of Realtors. Table 1 shows the selected metro areas along with their Housing Affordability Index score. The index measures whether the typical family in each region earns enough income to qualify for a mortgage loan on a typical single-family home. An index above 100 signifies that a family earning the median income has more than enough income to qualify for a mortgage loan on a median-priced single-family home, assuming a 20 percent down payment. The index for the Twin Cities area was 141, placing it above the affordability threshold. In other words, out of these metro areas, the typical family in the Minneapolis/St. Paul area earns enough income to qualify for a mortgage on a typical single-family home. But relatively attainable homeownership does not erase broader affordability problems across the housing market, especially for renters and households with lower incomes. 

Table 1. Housing Affordability Index 

Those pressures remain substantial. National Low Income Housing Coalition data shows that the Twin Cities metro faces a shortage of 72,927 affordable and available rental homes for households at or below 50 percent of area median income in 2024, with only 62 such homes available for every 100 renter households in that income range. Metropolitan Council data also show that more than 27 percent of all households in the region are cost-burdened, including 47.5 percent of renters and 18.4 percent of homeowners. The burden falls even harder on Black and American Indian households, showing that the region’s affordability challenge is not only about total supply, but also about who can access housing near opportunity. 

At the same time, the city of Minneapolis shows how local policy can ease housing pressure. Between 2017 and 2022, the city increased its housing stock by 12 percent while average rent rose by just one percent. That trend does not solve the regional shortage on its own, but it suggests that adding homes at scale can moderate rent growth in at least part of the market. 

TOD Across Jurisdictions 

Metropolitan Council 

The Metropolitan Council (Met Council)—the region’s metropolitan planning organization—sets the regional transit-oriented development (TOD) policy framework for the Twin Cities region. Its policy, adopted in 2013, aims to: 

• Maximize the development impact of transit investment.
• Strengthen regional economic competitiveness by leveraging private investment. 
• Advance equity by improving multimodal access.
• Support a 21st-century transportation system through stronger ridership and revenue.

The Council’s Regional Development Guide—currently known as Imagine 2050—shapes TOD policy across the region. It helps local governments create consistent, compatible, and coordinated local comprehensive plans. Land use, housing, transportation, water, and park plans are all coordinated through this common policy document, including guidance for TOD and transit-supportive development.  

The Met Council also uses a TOD Prioritization Tool that classifies station areas by urban form and market conditions and recommends the TOD strategies most likely to work for each one. For example, the tool recommends that cities with strong real estate markets and easy access to transit should retain affordable housing and strengthen walkability. In station areas with limited infrastructure to support walking, the tool recommends generating support for a long-term vision and identifying infrastructure needs. 

Met Council Grants 

Met Council reinforces its TOD policy framework with grants through its Livable Communities program—funded by a dedicated regional tax levy. Those grants support projects that connect housing, jobs, and services; mixed-use projects in TOD-eligible areas; pre-development work; policy development; and programs that preserve or expand affordable rental and homeownership housing. The Council ties competitive grant eligibility to regional housing policy goals. These tools matter because even a region with strong transit policy still depends on local land-use rules to guide how much housing can actually be built near transit. 

Metro Transit 

Metro Transit is the region’s primary transit provider and operates under the Met Council. The agency established its TOD office in 2013. The office describes itself as a “one-stop shop for developers and urban planning professionals interested in pursuing or advancing TOD.” The office helps align development with transit investments and works on sites that Metro Transit acquired for rail and bus rapid transit projects but no longer needs for operations. 

Metro Transit also uses data to show where transit and development already reinforce each other. Its 2023 report, Development Trends Along Transit, found the following: 

• $11.3 billion in planned development sits along high-frequency transit corridors, even  though those corridors cover only 4 percent of the region’s land area. The same areas account for 44,000 planned multifamily units, or 46 percent of all such units planned regionwide. 
• Fifty percent of planned development value in the region is mixed-use, and 73 percent of that mixed-use development is located near high-frequency transit. 
• Forty-one percent of all planned multifamily affordable housing units are located near high-frequency transit. 
• For deeply affordable multifamily units—those affordable for households earning up to 30 percent of area median income—76 percent are located near high-frequency transit. 

These numbers help explain why the region continues to focus on housing growth along transit corridors. 

Cities and Counties 

Cities rely on the Met Council’s Regional Development Guide as they draft comprehensive plans. Using that guidance, cities conduct day-to-day work that determines whether station areas become transit-supportive neighborhoods. They lead station-area planning, write zoning rules, plan infrastructure, and work with property owners, residents, and community groups to guide redevelopment. 

Counties often handle early corridor analysis for light rail, help fund capital and operating costs, and shape county roads and rights-of-way that influence development near transit. Counties have their own TOD grant programs. For example, Hennepin County’s Transit Oriented Communities program provides funding to renovate and expand housing, mixed-use, and commercial projects, and to improve infrastructure and acquire property. 

Ramsey County’s Critical Corridors program funds projects that increase density, build multi-family housing, improve pedestrian and bicycle infrastructure, and promote development without displacement. The program prioritizes projects that add or preserve affordable housing.  

Zoning and Parking in Minneapolis 

The City of Minneapolis offers a clear example of how land-use reform can support housing market affordability and encourage TOD. Pew Charitable Trusts found that from 2017 to 2022, Minneapolis increased its housing stock by 12 percent while rents rose only 1 percent. Over the same period, the rest of Minnesota added 4 percent to its housing stock and saw rents rise by 14 percent. Pew points to four policies that helped Minneapolis expand its housing supply. Each one matters for TOD because each one reduces a different barrier to building more homes in transit-served areas: 

• Minneapolis eliminated all citywide parking minimums in 2021. This freed up land that would otherwise be used as parking lots. Near transit, that change also makes it easier to build smaller projects and price homes for households that are less likely to own multiple cars. 
• The city added several zoning districts that increase housing supply along commercial and transit corridors. Corridor districts permit three to six-story buildings, and transit districts allow 10-to-30-story buildings on lots adjacent to transit lines.  
• In 2020, Minneapolis adopted minimum building height requirements for new developments. This move helps the city build more housing in high-demand areas, like major transit corridors. 
• Minneapolis permits duplexes and triplexes on lots that were previously restricted to single-family housing. That flexibility makes it easier to build homes on lots once limited to single-family housing. 

Minneapolis’ reforms do not eliminate the need for subsidies to make housing affordable to low-income households, but they do show how zoning reform can open more sites for housing. 

Barriers to TOD and Affordable Housing 

Local Resistance 

Even in a region where public institutions strongly support TOD, local resistance can still slow or block affordable housing. Communities may support the idea of transit-oriented development, but object once a project includes income-restricted units, and some local zoning codes still make affordable housing harder to build. 

That resistance tends to be sharper in some suburban communities, where people still view affordable housing negatively. In practice, that means agencies often have to persuade local leaders and residents that affordability and transit-supportive development belong in the same conversation. 

Coordinating across jurisdictions 

Private developers and their lenders may resist mixed-income buildings, insist on more parking, or prefer separate buildings and amenities for different income groups. At the same time, Metro Transit generally wants enough population and density in place before it expands bus service, which can leave emerging walkable districts with only limited transit in the early stages. 

With more than 180 units of government involved, agencies do not always move at the same speed or with the same priorities. Met Council and county staff often respond to local ideas rather than drive them from the start, and smaller or outer-ring communities may remain less receptive to TOD than central cities. 

Key Lessons 

Pair housing supply with deeper affordability tools 

The Twin Cities show that adding housing can help moderate rent growth, but supply alone will not meet the needs of lower-income households. Cities, counties, and agencies still need subsidies, preservation tools, and funding streams that support deeply affordable housing. 

Treat TOD as a community strategy 

The strongest examples in the region focus on complete transit-oriented communities rather than isolated projects. Housing works best when residents can walk safely, reach stations easily, and rely on frequent transit services. 

Give local governments flexible tools and clear incentives 

Met Council’s grant programs, prioritization tools, and policy guidance help cities and counties translate regional goals into local action. Flexible funding also matters because communities need help planning, preparing sites, changing policy, and preserving long-term affordability—not just funding vertical construction. 

Center land use in the discussion 

Local zoning and parking rules still shape what the market can deliver near transit. Minneapolis shows that reforming those rules can open more sites for housing, while continued local resistance elsewhere shows how easily restrictive land-use choices can undermine regional affordability goals.