Buying an Affordable Housing Property: What You Need to Know

If you purchase a building or property that has existing affordable housing dwelling unit tenants and you have plans to convert the building for other purposes, there are city ordinances that need to be followed before you can terminate the leases without cause.

Many cities, including Minneapolis and St. Paul, require that a three month/90-day notice be given to the tenants and for the new owner to provide them with relocation assistance. Minneapolis’ Tenant Protection Period is three months and St. Paul’s is 90 days. Here is a breakdown of what it required in Minneapolis and St. Paul:

• Within 30 days of purchasing the property, the new owner must give notice to the affordable housing unit tenants that the building is under new ownership and the name, mailing address, and phone number of the new owner. If there will be changes to the existing leases, the new owner must also give notice of the following information:
  • If there will be an increase in the rent during the three month/90-day Tenant Protection Period, how much the rent will increase, and the date that the increase will go into effect.
  • If the new owner will require the existing affordable housing unit tenants to be re-screened to determine compliance with residency screening criteria during the three month/90-day Tenant Protection Period. If a new screening will be done, the tenants must be provided with the screening criteria.
  • If the new owner will terminate or not renew the tenant’s rental agreements without cause during the three month/90-day Tenant Protection Period and the date the rental agreements will terminate.
  • Whether these changes will take effect on the day immediately following the 90-day Tenant Protection Period.
  • The notice must also include a statement that is specific to each city, Minneapolis Code of Ordinances §244.2130 or Saint Paul Code of Ordinances §193.08, that states that affordable housing dwelling unit tenants have a three month/90-day protection period and that tenants may be entitled to Relocation Assistance from the new owner if the new owner does not renew the tenant’s lease without cause within the three month/90-day protection period. Additionally, tenants may be entitled to Relation Assistance from the new owner if the owner raises the rent or initiates a tenant rescreening process within the 3 month/90-day protection period.
  • The same notice that is provided to the affordable housing unit tenants must also be submitted to the Director of Regulatory Services for Minneapolis and to the director of the Department of Safety and Inspections for the city St. Paul.

Resources:

For Minneapolis— Click Here for Minneapolis Advance Notice of Sale

For St. Paul— St. Paul Advance Notice and Notice of Sale