The biggest rule difference for apartment owners in Minneapolis–St. Paul is that St. Paul limits most rent increases to 3% a year, while both cities layer licensing and notice requirements on top of Minnesota’s landlord-tenant statute. Knowing which city a building sits in, and when it was built, tells you most of what you need to know about how its rents can move.
St. Paul’s Rent Stabilization Ordinance in 2026
St. Paul voters approved rent stabilization in 2021, and the City Council has amended it twice since. As the city’s rent stabilization page explains, the ordinance limits residential rent increases to no more than 3% in a 12-month period, with several exception paths:
- Standard increase: up to 3% with no city approval.
- Self-certification: landlords can self-certify an increase between 3% and 8%, subject to the city’s annual evaluation.
- Staff determination: larger increases require a city staff determination supported by documentation.
- Partial vacancy decontrol: after a “just cause” vacancy, rent may be raised by up to 8% plus inflation as measured by CPI.
The most recent amendment, adopted May 7, 2025 and effective June 13, 2025, changed which buildings are covered. New construction had previously been exempt for 20 years; the council voted 4–3 to permanently exempt rental housing built after 2004, as reported by Minnesota Reformer and MPR News. While proposing the change, Mayor Melvin Carter said roughly 90% of the city’s rental units would remain covered.
For an owner, the build year is now the first fact to establish. A 1960s walk-up in Frogtown or on the East Side operates under the cap; a post-2004 building does not, and will not age into it.
Minneapolis Licensing and the Tier System
St. Paul’s rent ordinance applies only inside St. Paul’s city limits. In Minneapolis, the rule set that shapes day-to-day operations is the rental license. The city reports about 23,400 rental licenses covering roughly 123,000 units, each placed in a tier based on code violations and conditions.
About 160 licenses, covering roughly 2,250 units, sit in Tier 3, the category for properties with significant health, safety and livability violations. In October 2025 the City Council unanimously approved the STOP Slumlords ordinance, which will require council approval to renew licenses for repeat-violation properties, effective January 1, 2027, according to the City of Minneapolis announcement.
The city also publishes a template for the mandatory disclosures rental property owners must give tenants, another Minneapolis-specific compliance item. For anyone buying in Minneapolis, the license tier history is part of due diligence. A building with a clean Tier 1 record and one with a string of Tier 3 findings are different assets even at the same rent levels.
Minnesota Statutes That Apply in Both Cities
Underneath the local ordinances, and regardless of whether a building is in Hennepin County or Ramsey County, Chapter 504B of Minnesota Statutes governs every residential lease in both cities. Two provisions come up constantly in apartment operations:
- Pre-filing notice for nonpayment. Under Minn. Stat. 504B.321, a landlord must deliver a written notice and give the tenant at least 14 days to cure unpaid rent before filing an eviction, or longer if a local rule requires it.
- Late fee ceiling. Under Minn. Stat. 504B.177, a late fee requires a written agreement and in no case may exceed 8% of the overdue rent payment.
These rules affect cash flow timing more than rent levels. A building with chronic delinquency needs collections procedures built around the notice period, and late fee income cannot exceed the statutory ceiling no matter what a lease says.
Practical Takeaways for Twin Cities Owners
Owners and investors who hold in both cities tend to manage three separate rule sets: St. Paul’s rent ordinance, Minneapolis licensing, and the state statute that governs both. A few habits help:
- Keep certificate-of-occupancy dates and permit history on file for every St. Paul building; they determine whether the cap applies.
- Document the reason for every St. Paul vacancy, since only a “just cause” vacancy unlocks the larger reset.
- Pull Minneapolis license tier history before making an offer, and price in the 2027 renewal change for any Tier 3 property.
- Build 14-day pre-filing notices and the 8% late fee limit into lease templates and collections calendars.
Rent caps also flow straight into valuation, since a capped rent roll limits how quickly income can catch up to market. Our state-by-state guide to rent control and property tax puts Minnesota’s local approach in context. For neighborhood-level detail, visit our Minneapolis–St. Paul market page or browse Minnesota apartment markets.
