4 Minnesota Housing Law Changes Every Homeowner Should Know (2026)

Minnesota changed a lot of rules about your house this year: who can buy homes, how much property tax money the state hands back, and what your HOA can charge you. One big change died just before the finish line. Here are all four, in plain English, from my video above.

I’ve been doing this for more than 25 years and over 3,700 transactions, and the thing I care about most is that our clients know their rights. None of the money below shows up on its own. You have to know about it to get it.

1. The private equity home-buying ban (on hold)

The bill was SF 3173, and everyone called it the private equity ban. The idea: stop large investment companies from buying more single-family homes (one to four units) in Minnesota. It moved through the Senate this spring and made it into the Senate housing bill, then it was stripped out of the final bill in May. Nothing changed on August 1.

What it would have done:

• Applied to big institutional owners: funds, REITs and groups pooling outside investors’ money. Owners with 100 homes or fewer were not covered.
• Banned both direct and indirect ownership, so a company couldn’t get around it with a side entity.
• Required ownership details to be reported to the Attorney General, with penalties in the hundreds of thousands of dollars per violation.

Why it’s still worth knowing: it got closer than anything like it ever has in Minnesota, and bills like this tend to come back.

The part that rarely makes the headlines. As I covered in the video, about 26,000 single-family homes across the Twin Cities are owned by investors who own two or more homes they don’t live in, roughly 3.5% of the market. The giant investors this bill targeted hold only about 16% of that investor-owned group. The other 84% are smaller, local owners.

So if you’re buying, who are you actually up against? Nine times out of ten it’s not a hedge fund. It’s another buyer who wrote a cleaner offer. That’s something a good agent can help you fix.

2. The Homestead Credit Refund got a one-time boost

This one never made the news, but it’s signed and it’s putting money back in people’s pockets. The 2026 Minnesota tax bill, signed May 27, includes a one-time boost of almost 15% to the Homestead Credit Refund. That works out to about $213 more per household on average, for the roughly 588,000 Minnesota households in the program.

The Homestead Credit Refund pays back part of your property taxes if they’re high compared to your income. To qualify:

• You own your Minnesota home and live in it.
• It’s classified as a homestead with your county.
• Your household income is under the limit (just under $143,000 for this round).

The catch: you have to file for it on Minnesota Form M1PR. The state doesn’t advertise it. If you already filed, the Department of Revenue adjusts it for you. If you haven’t, the window runs into next summer.

Second program: the “targeting” refund. Some people call it the special property tax refund. If your property tax bill went up more than 12% from last year, and the increase was at least $100, the state may refund part of the jump. There’s no income limit, and it’s capped at about $1,000. It’s claimed on the same form.

Check both on the Minnesota Department of Revenue property tax refund page.

3. The homestead market value exclusion

This one works before your tax bill is printed. A refund gives you money back afterward. The homestead market value exclusion, on the books since 2012, takes part of your home’s value off the top before your taxes are figured, so you’re taxed on a smaller number.

• Homes valued at $95,000 or less get about a 40% exclusion, capped at $38,000.
• The break shrinks as the value goes up, and ends at about $517,000.
• At about $410,000, close to a typical Twin Cities home, it shields roughly $9,600 of value.

It’s not life-changing, but it’s real money every year you own the home.

If you’re buying, this matters most: homestead status does not transfer from the seller to you. You have to apply with your county yourself. Most counties let you do it online in a few minutes. Every November our team reminds clients to check on this. If you’re not sure your home is homesteaded, call your county or look it up on its website.

4. The HOA Reform Act (HF 1268)

This is the one people will be talking about all year. It was signed in May, and most of it takes effect January 1, 2027. Here’s what it does, as I walked through in the video:

Fines and fees

• A single violation fine is capped at $100, unless the full membership votes to go higher. The board can’t do it alone. There are exceptions for repeat violations, health and safety issues, property damage, and using the home to make money.
• Every association has to give you a written list of fines up front.
• Interest on late assessments is capped at 8%. Late fees are capped at $20 or 5% of what you owe, whichever is bigger.

That money piece matters more than it sounds. An HOA can foreclose on a home over unpaid dues, so a missed payment snowballing used to be a real risk.

Boards and contracts

• A board member can’t vote on a contract they, or a relative, would make money from. Property managers follow the same rule.
• Maintenance, construction or repair contracts of $50,000 or more need at least three written bids, with records of how the winner was chosen.
• Board terms are capped at 3 years, and elections have to happen on a regular schedule.
• You get 21 days’ notice before rules change, so you can speak up before you’re fined, not after.

Your rights

• HOAs can’t retaliate against you for challenging a fine, raising concerns at a meeting or asking for documents.
• For new communities created on or after January 1, 2027, cities can’t require a developer to create an HOA to get a project approved (unless the developer asks for one). If you’re shopping new construction, ask about this.
• Your HOA can’t stop you from parking a work vehicle in your own driveway. Plumbers, electricians, contractors and landscapers: this one’s yours.

Thinking of buying in an HOA? Read what home buyers should know about HOAs.

What to do now

1. Check that your home is homesteaded with your county. If you just bought, apply.
2. File Form M1PR if your income is under the limit, or if your tax bill jumped more than 12%.
3. If you’re in an HOA, watch for your association’s written fine list and new rules in 2027.
4. If you’re buying, don’t assume Wall Street is beating you. Work on writing the cleanest offer.

This is general information from my video, not legal or tax advice. Laws and dollar limits change; check the Minnesota Department of Revenue, your county, or an attorney for your situation.

Have questions about how any of this affects your home? Talk with our team, or see what your home is worth today.