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TOPA Exemption Law Passed by the DC Council

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TOPA Exemption Law Passed by the DC Council

TOPA Exemption Law Passed by the DC Council

Last Tuesday a new bill was passed by the DC Council that will exempt DC home renters from the TOPA (Tenant Opportunity to Purchase Act).


In simple terms, TOPA is a bill that, if a homeowner decides to sell their property, gives the renter the option to be “first in line” to buy. But with the new TOPA act of 2018, the right of first refusal is removed for those who live in single-family homes.

WHY does it matter?

DC has always been known to have extremely tenant-friendly housing laws. And one of those laws is the right to sell TOPA rights to the highest bidder. In 2016, Capitol Hill tenant, Sarah, did just that. And in taking advantage of this right, Sarah could use it to negotiate better building conditions, limit rent increases, and bargain with property owners in numerous other ways.

But to avoid situations like this, Council Member Brianne Nadeau proposed a new amendment that would eliminate these rights. She also proposed that TOPA exemptions be limited to owner-occupied homes, and that the time period given to a tenant to announce their intent to purchase should be shortened. Though a strong proposal was made, the amendment ended up falling through.

WHO is affected by the new TOPA laws?

Under the new bill that was passed on Tuesday all single-family dwellings, and all two-unit single family accommodations will be exempt from the first right of refusal. This new bill also applies to those in condominiums and co-ops. TOPA rights will remain assigned to all tenants renting in two to four unit buildings.

WHAT does the new bill state?

Aside from removing the first right of refusal for those who live in single-family homes, the new bill enacts that all eligible tenants, once given a TOPA notice, will have twenty days to provide both the city and property owner of their intent to buy. Furthermore, they will have 25 days for contract negotiation. The bill also states that 45 days will be given for settlement, with options for extension.

Also stated by the TOPA act is that if no sale has been made 180 days following the original offer, the TOPA timeframe will restart. In addition, any tenants who have been grandfathered in, but do not have the rights to sell off, are permitted to stay in their current unit at their current rate for one year after a sale has been made.

WHERE Is the bill now?

Currently, the bill is being sent to Mayor Muriel Bowser and awaiting signature. Congress will have an additional thirty days to review the bill if the Mayor signs. Then the bill would become law after any final markups are approved. We will see the impact that the new bill has on DC tenants and homeowners.

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Tony Taylor is a developer and licensed Realtor in Washington DC & Maryland. Tony has been in the real estate industry for just over 19 years and has developed properties throughout the DMV as well as Tampa, Florida. In addition, Tony has helped buyers, sellers and renters reach their goals for the last 6 years.

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