Sell Your Commercial Property In Minnesota

The Minnesota rental market at a glance

Minnesota had 641,268 renter households in the Census Bureau's 2020-2024 American Community Survey, or 27.8% of 2,307,955 occupied homes. Owners hold the other 72.2%. Apartment-style stock is modest: 493,880 Minnesota housing units, 19.4% of the total, sit in buildings of five or more units, per ACS table B25024.

Minnesota rental vacancy stood at 5.3% in the 2020-2024 DP04 housing profile. Statewide median household income was $89,062, so the $1,280 median gross rent equals about 17.2% of a typical household's gross income. Renters themselves feel more strain: 48.1% of Minnesota renter households paid 30% or more of income on rent, per ACS table B25070.

Five-year trends in Minnesota

Minnesota median gross rent rose 31.0% between the 2015-2019 and 2020-2024 ACS periods, from $977 to $1,280 a month. Median household income grew 24.9% over the same span, from $71,306 to $89,062. Rents therefore outran incomes by 6.1 percentage points.

Minnesota added 20,535 renter households between the two periods, a 3.3% gain. Units in five-plus buildings rose 11.7% statewide, adding 51,758 units. In percentage terms, the larger-building stock grew faster than the renter base it serves.

Growth was uneven across the seven-county core. Carver County renter households jumped 14.7% and Washington County added 10.9%, while Ramsey County grew just 2.8%. Scott County posted the fastest rent increase among the seven, 34.0%, and Washington County the slowest, 30.8%.

Minnesota county comparison

Median gross rent in these seven Minneapolis-St. Paul counties ranges from $1,329 in Ramsey County to $1,710 in Washington County. Rental vacancy runs from 2.6% in Carver County to 6.1% in Ramsey County, per each county's 2020-2024 ACS figures.

Ramsey County leads this group on renter share, at 39.4%, and Hennepin County leads on units in five-plus buildings, at 33.9%. Scott County is the most owner-heavy of the seven, with renters in 16.2% of occupied homes and 9.9% of units in larger buildings.

Minnesota landlord, tax and transfer rules

Minnesota taxes rental property on market value, assessed each January 2 under Minnesota Statutes Section 273.11. A building of four or more units falls into class 4a, taxed at 1.25% of market value under Section 273.13, and that tax capacity is multiplied by the local net-tax-capacity rate.

Minnesota sets no statutory cap on security deposits. Statutes Section 504B.178 requires a landlord to return a deposit, or an itemized claim against it, within three weeks after the tenant gives a forwarding address. On a sale, Minnesota law gives the seller 60 days to transfer or refund held deposits to the buyer or the tenant.

Minnesota charges a state deed tax of 0.33% of net consideration under Section 287.21, plus 0.01% more in Hennepin and Ramsey counties for an Environmental Response Fund fee. A $2 million Minnesota sale carries $6,800 in deed tax in those two counties and $6,600 elsewhere in the state.

Minnesota has no statewide rent control, but St. Paul caps most rent increases at 3% in a 12-month span under a 2021 voter-approved ordinance, with self-certified increases allowed up to 8%. Minneapolis's charter lets its council weigh rent rules, though no citywide ordinance is currently in effect.

What this means if you sell in Minnesota

Owners who sell commercial property in Minnesota are priced on rent rolls, vacancy and the next tax notice. A building in Carver County, at 2.6% vacancy, reads differently to a buyer than one in Ramsey County at 6.1%.

Taxes deserve the closest look. Because Minnesota's class 4a rate applies to buildings of four or more units at 1.25% of market value, selling an apartment building in Minnesota means walking a buyer through the January 2 assessment and the local net-tax-capacity rate before they model next year's bill.

We review Minnesota buildings of five or more units across the seven counties above and the rest of the state. Send the rent roll and the latest Minnesota tax statement, and we will set the property against these county figures.