SIOUX FALLS, S.D. (KELO) — A new study by GoodHire ranks Sioux Falls as the top city to live and work in the U.S.

But, what does that mean in a city where the availability of affordable housing and workforce housing is a frequent topic of discussion?

The South Dakota Legislature had lengthy discussions on a proposal to earmark about $100 million for affordable and workforce housing in the state. The proposal, and housing in general, was pushed to a summer study by the Legislature.

Various city and community leaders have been discussing the need for more affordable and workforce housing in Sioux Falls, both in terms of availability and how available options are not affordable for several groups of wage earners.

“That’s a question the whole state is trying to answer,” Jill Madsen, the chairwoman of the board for the South Dakota Multi-housing Association (SDMHA), said defining and meeting the need for affordable and workforce housing.

SDMHA is the trade association for South Dakota’s apartment and rental housing industry. Madsen works for Bender Midwest Realty Services.

The discussions and the need for affordable and workforce housing will continue, said Michael Crane, a consultant who works with housing including affordable and workforce housing.

The GoodHire study said it evaluated the seven factors in terms of weight percentage of wage growth (20%), unemployment rate (10%), job growth( (20%), percentage of jobs open (10%), renter affordability (15%), homeowner affordability (15%) and real per capita personal income (10%).

It does not provide specific details on rent or housing costs or incomes or other factors.

The analysis only included cities with a labor force of more than 150,000.

Both Madsen and Crane said affordability is a relative term.

Does affordable mean workforce housing as in residents who may make $15 or $18 an hour? Does it mean housing that is affordable to a resident who makes $50,000 a year.

The median household income in Sioux Falls was $61,178 in 2020, according to the U.S. Census Bureau. The per capita or average income was $33,276.

The United States Department of Housing and Urban Development (HUD) defines affordability as the occupant paying 30% or less of gross monthly income for housing costs

Affordable can be personal, Crane said. As in what does a person believe he can afford or is able to pay?

A renter in Sioux Falls will be paying more rent than three years ago, according to data from SDMHA.

The most recent study from a pool of those surveyed showed the average rent for a two bedroom unit was $1,023 a month, Madsen said.

The average rent for a two-bedroom in January of 2021 was $821 a month. The rent was $786 in 2018, $829 in 2019 and $827 in 2020.

“For three years it held steady and didn’t have a significant increase,” Madsen of the average two-bedroom rent.

The increase is from 2021 to 2022, is the “Most significant jump we’ve seen,” Madsen said.

The city’s population has been increasing each year to more than 200,000. According to the City of Sioux Falls Planning and Development Services. the total population estimate for Sioux Falls is 202,600. 

The rental market is responding to an increased demand with population growth and a need for landlords to recoup increased costs in operations, Madsen said.

The county and city of Sioux Falls have added households and housing.

The county added nearly 25,300 households from 2010 to 2020, according to a 2021 City of Baltic housing study. Most of those, 63%, was in the city city of Sioux Falls.

Additional housing has not kept up with need, particularly if affordable housing is defined as lower income or those who would qualify for some traditional housing programs based on household size and income, according to research.

“…there is a growing need for units affordable to households with incomes in the $20,000 to $35,000 range. Housing cost burdens among this group have been steadily increasing over time,” a 2021 Sioux Falls Housing Needs Assessment by the Augustana Research Institute.

Also as households and population has grown, the growth has been greater in the household higher income brackets, according to the study.

The study defined a household income of $50,000 or more as higher income and a lower income as less than $50,000.