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HF2687 (Legislative Session 94 (2025-2026))

Single-family home ownership restricted for corporate entities, increased deed tax rates on conveyances of single-family homes provided to corporate owners, state portion of revenues dedicated from the increased deed tax rates for the workforce and affordable homeownership program, and statewide landlord database created.

Related bill: SF3173

AI Generated Summary

Purpose of the Bill

This bill addresses housing issues in Minnesota by restricting corporate ownership of single-family homes, imposing higher deed taxes on such properties when sold to corporate owners, directing tax revenues to affordable housing programs, and creating a statewide landlord database.

Main Provisions

  1. Corporate Ownership Restrictions:

    • Corporations, partnerships, or real estate investment trusts are restricted from owning more than 50 single-family homes.

  2. Increased Deed Tax Rates:

    • A higher deed tax rate of 0.5% is applied when single-family homes are sold to corporate owners, with the revenue dedicated to the state’s workforce and affordable homeownership program.

  3. Exceptions to Ownership Restrictions:

    • The restrictions do not apply to governmental units, land trusts, nonprofits focusing on affordable housing, homes classified as homestead properties, housing-focused corporations, or mortgage note holders owning homes through foreclosure.

  4. Statewide Landlord Database:

    • Establishment of a public, no-cost database where landlords must annually report certain information about rental properties, including ownership details and contact information. This aims to increase transparency and assist tenants.

  5. Tenant Protections:

    • Tenants can report landlords not listed in the database, triggering an investigation. Landlord retaliation against tenants reporting issues is prohibited.

  6. Enforcement and Penalties:

    • Noncompliant corporate owners face penalties of $25,000 per excess home owned, and the commissioner has the authority to enforce these provisions.

Significant Changes to Existing Law

  • The bill amends Minnesota Statutes 2024 to increase deed tax rates specifically for corporate ownership transfers and allocates the majority of the proceeds to affordable housing funding.
  • It mandates a significant new requirement for landlords statewide to submit information to a publicly accessible database, which did not previously exist.

Relevant Terms

  • Corporate ownership, single-family homes, deed tax, affordable housing, landlord database, nonprofit organizations, tenant rights, enforcement, penalty.

Bill text versions

Actions

DateChamberWhereTypeNameCommittee Name
March 23, 2025HouseFloorActionIntroduction and first reading, referred toHousing Finance and Policy
March 23, 2025HouseFloorActionIntroduction and first reading, referred toHousing Finance and Policy
March 25, 2025HouseFloorActionAuthors added
March 31, 2025HouseFloorActionAuthor added

Citations

 
[
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Reference made to property classification under section 273.13.",
      "modified": []
    },
    "citation": "273.13",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Reference to land trust definition provided under section 462A.31.",
      "modified": []
    },
    "citation": "462A.31",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Enforcement authority provided to commissioner of commerce under section 45.027 for compliance with new legal stipulations.",
      "modified": []
    },
    "citation": "45.027",
    "subdivision": ""
  },
  {
    "analysis": {
      "added": [
        "Increased deed tax rate for corporate ownership of single-family homes."
      ],
      "removed": [],
      "summary": "Amendment to the subdivision in section 287.21 regarding deed tax calculation and applicability.",
      "modified": [
        "Clarification of tax applicability on single-family home conveyances to corporate owners."
      ]
    },
    "citation": "287.21",
    "subdivision": "subdivision 1"
  },
  {
    "analysis": {
      "added": [
        "Allocation of increased deed tax proceeds to housing development fund."
      ],
      "removed": [],
      "summary": "Section details the distribution of proceeds from deed taxes.",
      "modified": [
        "Modification of tax revenue allocation addressing increased deed tax rates for single-family homes."
      ]
    },
    "citation": "287.29",
    "subdivision": "subdivision 1"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Defines 'landlord' as per section 504B.001, subdivision 7.",
      "modified": []
    },
    "citation": "504B.001",
    "subdivision": "subdivision 7"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Defines 'residential building' under section 504B.001, subdivision 11.",
      "modified": []
    },
    "citation": "504B.001",
    "subdivision": "subdivision 11"
  },
  {
    "analysis": {
      "added": [],
      "removed": [],
      "summary": "Defines 'tenant' under section 504B.001, subdivision 12.",
      "modified": []
    },
    "citation": "504B.001",
    "subdivision": "subdivision 12"
  }
]

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