Skip to Content
Newsletters

Did you know that the DC Council recently passed a bill that will exempt single-family homes from the requirements of the Tenant Opportunity to Purchase Act?

April 13, 2018

Did you know … that the DC Council recently passed a bill that will exempt single-family homes from the requirements of the Tenant Opportunity to Purchase Act?

TOPA gives tenants the right of first refusal to purchase their rental accommodations when property owners decide to sell.  The purpose of TOPA is to protect tenants, particularly the poor and the elderly, from displacement and the loss of their homes.  It was reported, however, that TOPA was being manipulated in a manner contrary to its purpose. 

With respect to single-family homes, TOPA gave tenants up to 180 days to register their intent to purchase the rental accommodation, negotiate a contract of sale, obtain financing, and complete the transaction, with a possible extension of time to obtain financing.  If 180 days passed from the date of a valid offer and no sale was made, then the owner had to restart the entire TOPA process. 

According to the Committee Report on B22-315 (the “TOPA Single-Family Home Exemption Amendment Act of 2018” or the “Bill”), tenants have used the 180-day TOPA timeframe to delay or block home sales in an effort to obtain high-dollar payouts from homeowners, making it more time-consuming and expensive for homeowners to sell.  The Bill seeks to resolve this issue by eliminating the right of first refusal for renters who live in single-family accommodations.  Under the Bill, the term “single-family accommodations” includes single-family dwellings, single-family dwellings with accessory dwelling units, and rental units in condominiums, cooperatives or homeowners associations. 

Under the Bill, within 3 days of receiving or soliciting an offer to purchase a single-family accommodation, the owner must provide notice to the tenant of the offer.  This is essentially a “heads up” notice that allows the tenant to plan for the change.  This notice does not trigger any rights, unless the tenant falls within a protected class. 

As proposed in the Bill, certain tenants continue to receive TOPA protection, including elderly tenants and tenants with disabilities.  If the tenant is elderly or has a disability, then upon receipt of the notice from the owner, the tenant has 20 days to deliver a written statement of interest to the owner.  Failure to deliver this statement is deemed a waiver of the tenant’s TOPA rights.  If the tenant delivers a statement of interest, then the tenant has 25 days to negotiate a contract of sale.  If a contract is made, the tenant then has 45 days to settle, with the possibility of a 30-day extension of time if the lender submits a written statement that financing will take 75 days.  The only consideration that the elderly or disabled tenant may receive for the sale or assignment of the tenant’s TOPA rights is the right to immediately use and occupy the tenant’s unit for a period of 12 months following the sale of the single-family accommodation at the rate of rent charged to the tenant as of the date of the offer.  The ability to further reassign TOPA rights is limited, and no consideration is allowed in exchange for a secondary assignment. 

The Bill is awaiting the Mayor’s signature.  View a copy of Bill 22-315 here.

For more information regarding our Residential Real Estate Settlements Group or our general real estate transactions and litigation practice, please contact the Group Chair at (301) 230-6574 or settlements@shulmanrogers.com.

This publication/newsletter is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting a lawyer.  

Residential Real Estate Practice