For as long as I have owned properties in Minneapolis, I have always been confused by the occupancy limits per unit.  The official language of the housing rules and standards for occupancy is:

The maximum occupancy for a dwelling unit located in in these zoning districts [R1, R1A, R2, R2B, R3] is one (1) family plus up to two (2) unrelated persons living together as a permanent household, provided the family plus unrelated persons shall not exceed a total of five (5) persons.

Ok.  Seems straight forward enough.  So what does this mean?

• Family is defined as:  An individual or two (2) or more related by blood, marriage or adoption, including foster children and domestic staff employed on a full-time basis.
• 6 guys living in a 6 bedroom house do NOT qualify under this ordinance.
• 12 family members living in a 6 bedroom house DO qualify.
• 3 family members and 3 couch sleeping friends, do NOT qualify.

The Minneapolis City Council is considering an ordinance change in regards to more inspections on the city’s rental properties.  Here is the details of the change:

Rental Licensing: Ordinance creating a furnace and boiler safety check and energy audit requirement for certain rental properties and repealing sections 244.680 and 244.685; and adding a requirement for a lead clearance inspection for certain rental properties and amending requirements related to lead safe work practices.

This new regulation can only add to more inspections as once the inspectors are inside your property, they are within their jurisdiction to call out other issues that need to be brought up to code also.  This will continue to push landlords that are barely making their mortgage payments to simply throw in the town and let their properties go into foreclosure.  Which will add to the blight on the city.

What is the scope of the energy audit mentioned?  Could the city require new windows and more insulation in attic and if you don’t comply they simply condemn the house as unfit?  Lastly, I suspect if this ordinance is passed we will next see that the City needs to add inspector headcount to satisfy this new requirement (adding to the bulging tax burden).  Where does it end?

The Minneapolis City Council will consider testimony from the public regarding proposed changes to the city’s rental license ordinance.
Date/Time 2/14/11 1:30 PM
Location Council Chambers, Room 317 City Hall

A Special Research Report from the Minneapolis Area Association of REALTORS®
Q3-2009

Lender-owned foreclosure inventory available for sale in the Twin Cities has fallen by 60 percent in the last year, falling from an estimated 4,886 at the end of last September to 1,960 this year. Short sales are a different story—basically holding steady over the last twelve months (Figure 1). Lender-owned Minnesota foreclosures now account for only 7.9 percent of the total inventory, while short sales represent 17.4 percent of total inventory.

The simple reason for this growing chasm is that foreclosures are selling roughly three times as frequently as short sales (Figure 2). Short sales are complicated transactions and many consumers have reported considerable delays and uncertainties associated with making an offer on a short sale home. These complications are likely the main cause of the relatively quiet sales activity.

Foreclosures are properties in which the financial institution has repossessed the home from the owner due to nonpayment of mortgage obligations. Short sales are unique arrangements where the financial institution and in default homeowner work together in an attempt to sell the home before it is foreclosed upon.

It’s encouraging to see the number of vacant foreclosures drop as they’re absorbed by new homeowners. But it’s discouraging to see that short sales remain such a substantial drag on the market’s forward momentum, especially when we consider that a portion of these short sales will eventually become lender-owned foreclosures.

With all the foreclosures on the market, it can be risky at times not knowing whether a property has code compliance on it, has a VBR or even if it is condemned and ready to be demolished.  Below are some easy instructions on how to check on a property’s status in the City of Minneapolis.  Note:  It does not give you info on Assessments or on rental licenses status/availability, but it is a quick way to see if you are going into any issues.

1. Go to:  http://www.ci.minneapolis.mn.us.
2. Scroll down to the right hand side and click on property information.
3. Choose property look-up service.
4. Enter the address you are interested in.
5. As a test, put in 3227 Girard Ave N (you can put in a partial address like:  3227 Gir).
6. Scroll down to the bottom of the screen and look for “active parcel flags” (in the case of 3227 Girard-you will see that the property is condemned requiring code compliance and also has a VBR on it.)
7. If you click on Truth in Housing, this will show you if one has been done (by law one must have been completed PRIOR to property being put on the market for sale).
8. If the property is condemned, the Truth in Housing will become invalid and you will see a comment that says:  “condemned requires code compliance”.
9. If you do not see the link to Active Parcel Flag, this means the property is not condemned and does not a a Vacant Building Registration (or VBR).

Lastly, as part of our inspection period, we have started having our title company (for a nominal fee) run an assessment search to see what could potentially extra costs incured by the buyer at closing.  Lots of checks and rechecks to try and smooth out the process of buying foreclosed homes in Minneapolis.

In Feburary 2008, the University of Minnesota bought the former Plymouth-Penn shopping center at 2100 Plymouth Ave N, in North Minneapolis.  The U of M plans to begin construction and rehab on the property soon, turning it into the UROC, the Urban Research and Outreach/Engagement Center; which is currently located on campus at 110 Morrill Hall.  The center is proposed to open in late 2009.

The center was started several years ago as Minneapolis Mayor, R.T. Rybak encouraged the university to help solve the complex problems in North Minneapolis.  The goal was to create partnership aimed at building a stronger and healthier neighborhood that would tie together community and university expertise and resources and leverage these with city and county services and resources.

Once open, the UROC building will provide space for outreach and research programs centering around early childhood education, health disparities in relationship to income, 4-H, family development, and youth leadership to name a few.  Multiple private and federal grants will help establish programs that will benefit the residents of North Minneapolis.

Steve Perry at the MinnPost wrote a very interesting article about who is really getting hurt by the foreclosures in Minneapolis.  Mr. Perry interviewed Ryan Allen, an assistant professor of Housing and Community Development at the U regarding the research he has done into Minneapolis Foreclosures.  Professor Allen presented his findings last week at the State Demographic center and the Humphrey Institute.

You can read the entire interview here.