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February 21, 2008


Bonnie Erickson

Casey, what you are describing is certainly a struggle. I have seen a lot of work done by handymen and homeowners that is less than quality. I've seen a lot that is excellent quality as well. I'm guessing the city is trying to maintain a high standard of quality in their housing by requiring permits.

What you are talking about regarding the vacant houses is one of the reasons the city is trying to take this action. They recognize the harm the vacant homes are doing to the neighborhood. I think the city council and everyone is in agreement about the harm that is occurring from the vacant homes. The problem comes in determining how to solve the problem and get back to normal safe neighborhoods.


We recently bought a vacant house without too much info from our realtor who hired a crappy inspector telling us not big repair need to be made. As sad as it was, we later found out the repair indeed does not need much money if we could use the unlicensed contractor. But only the licensed and insured contractors could get permit from the city and they all charge sky rocket price. For example, an unlicensed contractor charge 2500 to replace a boiler but a licensed one charge 9000$. Now I personally work for a bank, from a cost perspective i could see why the bank don't want to do it. It looks to me the city inspector and council just teamed up to charge whoever owns the house tons of money. Add each permit extra 500$. Who says they care about the city? Then tell me why their phone can only be reached from 7:30 to 9am? If it is my house, why can't I decide who is going to do my repair or how? Why can't I repair the small stuff later but I have to bring everything? The vacant house caused the local crime rate to go up and nobody is caring that any more. What is wrong with St Paul?

Bonnie Erickson

Andy, you're right about the rehab to rent scenario now. Landlords have been saving their shekels for just this market because they all knew it was coming. If I had not bought a house that needs extensive fixing, I'd be right out there buying up property to fix and hold myself. The key is that it has to be held for a few years until the market settles down again. At these prices, who wants to sell anyway. One can easily cash flow with conservative rents.


I know as a banker, I have been financing a decent amount of rehab-to-rent properties on the East side. There is certainly demand for rental units in the area from my experience.

Granted my borrowers are typically getting tremendous prices from the banker's (Lender owners) you are referring to who don't want to put any additional money into these homes. It is really too bad because sometimes it isn't that much TLC and the lender could save much more on the losses they will undoubtedly incur.

Bonnie Erickson

Actually, Carole, the comments about commission were made by the author of the bill, not the opposing parties. In Minneapolis point of sale inspections are done by private inspectors that are on the city's approved list. They are not city employees. If permits are required for the repairs, then the re-inspection is done by the city employees.

Carole Cohen

So during comments the people on 'the other side' have to make a crack about agent commissions that have nothing to do with the issue? Lordy! Anyway, Point of Sale could work well, and also, I imagine, employ a few more people since more inspectors would be needed, as well as helping to keep the housing stock up to standards. Lovely photo!

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