Did you know TOPA was amended as of July 3?
The DC Department of Housing and Community Development will hold a workshop in a couple weeks to provide an overview of the newly enacted Single-Family Home Exemption Amendment Act of 2018 (Bill 22-0315, Act 22-339).
The workshop will take place Wednesday, July 25 from 1 to 3 p.m. at One Judiciary Square, located at 441 4th Street NW, Old Council Chamber Room, Washington, DC 20002. The workshop is free but you must register to attend.
For those who cannot attend in person, the DHCD Facebook page will also broadcast the workshop live.
The workshop will cover a variety of topics including:
- Types of single family properties that are exempt
- Criteria that an elderly or disabled tenant must meet to still have a limited opportunity to purchase
- Notice and documentation requirements
Q: Can TOPA rights be assigned without a contract?
A: With our without a contract, TOPA rights can be assigned.
Q: How much (consideration) does the landlord/owner need to pay the Tenant to make the assignment valid?
A: Most title insurance underwriters agree that there must be at least $300.00 of consideration which can be in the form of rent abatement/waiver, moving expenses, or cash payment.
Q: What forms must be provided to the tenant prior to the existence of a contract?
A: The landlord/owner must provide TOPA Form B by certified mail before tenant signs the agreement to assign. Because the rights of first refusal will be assigned concurrently with the rights to purchase, it is not necessary to provide Form C.
Q: What forms must be provided to the tenant with the existence of a contract?
A: The landlord/owner must provide TOPA Form A by certified mail before tenant signs the agreement to assign.
Q: Once the Assignment is signed by both landlord/owner and tenant, is there a waiting period before settlement can occur?
A: No. However, do note that either Form A or Form B must be sent by certified mail in order to satisfy the legal requirements such that the rights become legally assignable.
As a settlement attorney in the District of Columbia, the last thing you want to hear for the first time at the settlement table is there are/were tenants in the property being sold.
The Tenant’s Opportunity to Purchase Act (TOPA) is very pro-tenant and is often daunting for agents to tackle as part of a listing or as part of a purchase. Fortunately, there is guidance out there and the shock of the last-minute TOPA issue has become less likely as agents and their clients have become more educated on the process.
The Greater Capital Area Association of Realtors (GCAAR) has been proactive in getting forms out on its platform to assist agents, such as the Tenancy Addendum for Washington, DC and a TOPA Affidavit that is accepted by most title insurance underwriters.
The DC Department of Housing and Community Development now provides the Tenant Notice forms online. These forms are very specific as to who is to be given notice, when notice is to be given and how notice is to be given. The forms also specify the timeframes in which all parties – property owners and tenants – are to act.
It is important to note that giving notice to each of the tenants is not enough in the District of Columbia; you must also give notice to the Mayor c/o District of Columbia Department of Housing and Community Development – Rental Conversion and Sale Division.
Following directions on these forms is imperative for a successful tenant occupied property sale.
A common, but easily preventable, occurrence for many commercial property owners is having a mechanic's lien filed against their property when their tenant has not paid its contractor and/or their tenant's contractor has failed to pay one of its suppliers, subcontractors or laborers for improvements made to the property by the tenant.
The mechanics lien is a cloud on the property's title and can prevent the sale or refinancing of the property until the mechanic's lien is paid. Often a mechanic's lien for tenant improvements is discovered long after same has been filed in the public records, but by taking a few proactive measures landlord's can ensure that their properties will be protected from the burdens imposed by such mechanic's liens.
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There is great consternation among Realtors®, title attorneys, buyers and sellers of residential rental property in D.C. and for good reason.
The creation of Tenancy Addendum Form to be used with Form 1313 (enough to cause tristadecaphobics agita) is more curse than blessing. As a litigator of real property disputes in D.C. and Maryland for close to 30 years, use of this form will be a boon to business. Now for the skinny.
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