SF3173

Purpose of the Bill

The bill aims to regulate the ownership of single-family homes by corporate entities, increase deed tax rates for corporate purchases of such properties, and use the revenue for affordable housing programs. It also introduces a statewide landlord database to improve transparency and tenant rights.

Main Provisions

• Restrictions on Corporate Ownership: Corporations, partnerships, or real estate investment trusts are restricted from owning 50 or more single-family homes (defined as properties with one to four dwelling units).

• Exceptions: The restrictions do not apply to government entities, land trusts, specific non-profits, corporations engaged in housing development, or banks holding foreclosed properties.

• Deed Tax Increases: The bill proposes a higher deed tax rate of 0.5% on the net consideration of single-family homes transferred to corporate owners.

• Usage of Revenue: Additional revenue from the deed tax increase will be allocated to the Minnesota Housing Finance Agency for the workforce and affordable homeownership development program.

• Statewide Landlord Database: A database is to be established by the commissioner of commerce where landlords must submit ownership and contact information, which will be searchable and accessible to the public.

• Tenant Protections: The bill protects tenants from retaliatory actions by landlords if they report missing landlord information to the database. It also permits tenants or prospective tenants to notify the agency if a landlord is not listed in the database.

Significant Changes to Existing Law

• Enforcement and Penalties: The commissioner of commerce can levy penalties on corporate owners exceeding ownership limits and can enforce compliance using existing legal frameworks.

• Deed Tax Allocation: Changes the apportionment of deed tax proceeds to dedicate significant revenues to the housing development fund for affordable housing initiatives.

• Landlord Accountability: Mandates annual submissions from landlords to the new database and outlines penalties for non-compliance, enhancing transparency and accountability for property ownership.

Relevant Terms

• Corporate ownership
• Single-family homes
• Deed tax
• Affordable housing
• Landlord database
• Tenant rights
• Housing finance
• Non-profits