Understanding Key Changes in Landlord Responsibilities: HB 693
If you own or are considering owning investment property for rent, it is crucial to stay informed about the legal landscape of landlord-tenant relationships. On October 1, significant changes will take effect as outlined in the recent legislative document, HB 693. These updates impact how landlords must interact with tenants, especially when planning to sell their properties. Here's a breakdown of the key changes every landlord needs to know:
Key Changes to Landlord Responsibilities:
1. Planning to Sell Your Property?
- Notice of Sale:
Landlords will now be required to provide a written notice of sale to the tenant, offering them the option to purchase the property. The tenant has 30 days to respond to this offer before you can list the property on the public market. - Right of First Refusal:
If the tenant has not accepted the offer to purchase and the owner has received and intends to accept a third-party offer - if that offer is 10% or more lower than the price previously offered to the tenant, tenants now have the right of first refusal. This means they can purchase the residential rental property by matching the terms of the third-party offer. (If the tenant's offer matches, the landlord must accept it.) - Counteroffers:
If the tenant's initial offer deviates from the terms of the third-party offer, the landlord must provide a counteroffer within five days. The tenant then has another five days to accept or reject the counteroffer. - Documentation:
The notice of sale and any notice of third-party offers must include the sales price offered by the third party, and a copy must be sent to the Office of Tenant Legal Assistance (OTLA).
2. Limitations and Exemptions:
- Exempt Transfers:
The right of first refusal does not apply to certain transfers, such as those to family members, business entities wholly owned by the owner, court-ordered transfers, transfers by fiduciaries, or transfers to government entities. - Waivers and Assignments:
Any attempted waiver or assignment of the tenant's right of first refusal is void. Tenants cannot waive their rights under this provision.
3. Penalties for Non-compliance:
- Landlords who fail to comply with these provisions may be fined up to $1,000 per violation.
Stay Informed and Compliant
As a landlord, staying informed about current laws and regulations is essential. Consider hiring a reputable property management company to ensure compliance and avoid costly fines. These professionals can help navigate the complexities of landlord-tenant laws and ensure all legal responsibilities are met.
For more detailed information, refer to the full legislative document, HB 693, and keep your rental operations compliant and fair for all parties involved, and as always, feel free to reach out if you have any questions on how this might affect your own personal scenario.
