North Minneapolis residents fight out-of-state investors, poor maintenance

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If you’re a landlord in the city of Minneapolis, you already have the home field advantage when it comes to the rental game. But some North Minneapolis residents say they’re tired of out-of-state landlords playing hardball with their neighborhoods.

Last month, more than 130 Minneapolis residents signed a petition demanding a moratorium on rental licenses issued by the city of Minneapolis until all Northside residencies have been inspected and brought up to code.

“There is a problem in the city of Minneapolis with proper tracking of the conditions of some of the rental properties,” said north Minneapolis resident Connie Beckers in the petition. “Too many single family homes have been scooped up by investors who rent them out, don’t screen their tenants and don’t keep up with even minimal upkeep at their properties.”

Data from the Minneapolis Regulatory Services shows the number of rental licenses distributed to owners with more than 10 rental licenses has risen dramatically in the city over the last decade. According to the data, monopolization of properties by single owners in the Folwell, Jordan and Hawthorne neighborhoods have more than doubled in the last five years.

Beckers said that part of the problem is that there’s too much focus on rental properties. An out-of-state investor recently purchased five homes on her block, she said, bringing the number of rental properties on her block to 15, while only nine are retained by homeowners.

“Most are single family homes which are often poorly cared for and maintained.” Beckers said. “These properties are sometimes inhabited by trouble makers, as well, which brings down the livability factor.”

The homes on Beckers’ block were purchased by Georgia-based HavenBrook Homes, who alarmed neighborhood leaders earlier this year after purchasing dozens of houses in north Minneapolis in just a few months, reported the Star Tribune.

Geroldine McNeill lives in a property owned by HavenBrook and said that the experience hasn’t been pleasant.

“It’s hard to really get ahold of them,” McNeill said. “They are very rude. Once you get ahold of them, you ask them certain things and they’ll hang up on you.”

McNeill, who is a recipient of Section 8, said her property has failed three different inspections in the last five months. On top of that, the company only performs minimum maintenance, she said, and charged her $70 for lawn care services.

Under Minnesota law, property owners cannot require tenants to do maintenance, including lawn care. They can, however, compensate tenants for maintenance through payment or reduced rent.

And when McNeill decided not to renew her lease, she said, her landlord retaliated by charging her $5,000 for water and sewage. “I’m on Section 8,” she said. “How am I supposed to pay that?”

HavenBrook representative Sandra Noonan said there were no records of the $5,000 charge, and that they don’t charge tenants for lawn care. The company refers tenants to a third party, she said, and adjusts the rent to reflect the exchange.

HavenBrook also released this statement:

“We absolutely agree that properly maintained homes are essential to the well-being of every neighborhood. Our Minneapolis team, staffed by Minnesota locals, works continuously to ensure compliance with all codes and standards, and provides our residents with comprehensive written guidance on filing maintenance requests and keeping their homes in good condition.

“By conducting extensive renovations on vacant, physically distressed properties, we make homes more habitable, energy efficient, and code-compliant, thereby supporting property values. We also seek to be a constructive presence in communities – assisting in the training of local landlords, attending neighborhood events, and working to provide resources and education to our residents.”

Minneapolis laws as they are now can only react to problems as they occur, rather than prevent them.

“Currently there is no cap on the number of properties an LLC can own,” said deputy director of Minneapolis Housing Inspection Services JoAnn Velde. “The city has discussed limiting the number of rentals on a block, similar to Winona law which was challenged at the State of Appeals [Court], and the state supported Winona law to limit the rentals.”

That law, which limits rental properties to 30 percent of any block, is now being challenged at the state Supreme Court, Velde said, but Minneapolis is monitoring it to help influence their decision as they move forward.

Minneapolis primarily performs inspections based on tenant complaints, Velde said, but they also systematically inspect all rental buildings in the city over an eight-year period. But there are about 23,000 rental buildings in the city, she said, so the city encourages residents to report violators of housing code.

Housing attorney and HOME Line director Michael Vraa said the solution is complicated, but that tenants should better familiarize themselves with their rights. Tenants should know things like how it’s the owner’s responsibility to shovel and mow, he said, not the tenants.

But ideally, he said, these problems should be addressed by both tenants and the city.

“Obviously, more money with more inspectors and more tenant awareness of their rights would be a start in solving the problem,” he said.

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