This is a perfect case of government liberalism gone wrong. Winona, MN believed that by implementing a rental ban, they could ensure the integrity of the housing communities. What happens instead is homeowners that weren’t able to afford their mortgage or had moved away, let the property go to ruins. They would have taken care of the property had they been able to get some rental income.
This also takes away investor demand which keeps prices low but makes it incredibly harder for homeowners to sell their property.
A court will consider whether homeowners have the right to rent out their property.
In the small college town of Winona, Minn., a court today will hear arguments on a case that could have dramatic implications for the property rights of every homeowner in Minnesota.
In 2005, Winona imposed a controversial ban on the number of homeowners who can rent out their properties. Under this rental ban, the government grants only 30 percent of homeowners on any given block a rental license. Similar rental bans are spreading throughout Minnesota: Mankato, West St. Paul and Northfield are also forbidding large percentages of property owners from renting out their homes. In 2011, West St. Paul enacted the most restrictive rental ban of all — only 10 percent of homes can receive rental licenses.
Winona’s rental ban has been devastating for homeowners who move away and are unable to sell their homes because of a terrible housing market. Instead of letting the homes sit unoccupied, many homeowners want to rent out the property to help pay the mortgage. But the rental ban has plunged several Winona homeowners, like Ethan Dean, into financial trouble.
Dean purchased a simple but nice home near downtown Winona, but had to leave when he was called to go serve his country as a U.S. adviser in Afghanistan. Now, Dean’s home sits empty and is about to be foreclosed on because he cannot sell or rent it out.