Why Do We Need This Bill?
As the COVID-19 eviction moratorium ends, the scarcity of affordable housing for low-income families in Massachusetts will be further exacerbated by widespread foreclosures. Speculative buyers have already set up post-pandemic investment funds in these previously affordable housing properties. Large investment firms will buy these distressed properties and convert them to luxury condominiums when prices rise in the future.
An act to guarantee a tenant’s first right of refusal will preserve the stock of affordable and subsidized housing for low-income tenants. This bill encompasses the Tenant’s Opportunity to Purchase Act (TOPA), which will give tenants, or their designated buyers, more time and opportunity to assemble financing and buy these properties before luxury developers. This will not only preserve the affordability of rental housing, but also help facilitate conversion to subsidized property.
How Does This Bill Work?
Tenants will have an opportunity to purchase the rental property first when it is put up for sale. When the current owner receives a third party offer to purchase the property, the tenant must be notified. The renter would then have the opportunity to purchase with the same price and conditions. Furthermore, the offer must be presented within a reasonable time frame that is typical in the normal market, and the sale prices must be market-rate. The right of first refusal applies only to tenants in good standing who are renting investor-owned properties. It does not apply to tenants in owner-occupied properties or small landlords.
If the tenants cannot purchase the property, they may form a tenant association made up of tenants in at least 51% of the tenant-occupied units to collectively purchase or designate a buyer for the property. The designated buyer may be any organization, developer, or government agency who can secure financing and intends to maintain affordable rent. Not only is TOPA cost-neutral for the state, but it is an enabling act, meaning it will only go into effect if municipalities accept it.
This is a brief diagram by CHAPA depicting the process of right of first refusal:
Who will this Bill Help?
Displacement and evictions disproportionately affect people of color, single mothers, people with disabilities and, other vulnerable groups. TOPA will protect communities from further inequity as it creates pathways to ownership for tenants.
History of the Bill
The Tenant’s Right of First Refusal/Tenant Opportunity to Purchase Act (TOPA) is not a new bill. This act was first enacted in Washington D.C and has helped preserve thousands of homes. Furthermore, versions of this bill have been successful in many states and cities such as San Francisco, Berkeley, California, Chicago, New Hampshire, as well as Washington D.C.
For More Information:
How Can You Help?
Write/call your elected officials.
You can find your State Representative and Senator HERE. These elected officials work for you, and it is immensely important that they hear from their constituents about what you want them to do as your representative. Here is a script you can use to email or call your representatives:
Dear Representative/Senator [NAME],
My name is [NAME] and I am Emailing on behalf of [ORGANIZATION]. I live in your district and wanted to talk to you about a piece of legislation that is crucial to helping end family homelessness in Massachusetts. This bill is incredibly important to me and I would really appreciate your advocacy around, especially by co-sponsoring the bill.
On any given night in our state, 18,471 people experience homelessness, a number that has more than doubled since 1990, and over 12,000 of them are in families with children. Since 2007, no other State in America has seen a larger increase in family homelessness. It doesn’t have to be this way! There are concrete laws that can be passed that will drastically transform Massachusetts into a State where homelessness really is brief, rare, and non-recurring.
As your constituent, here is the bill I’d like you to co-sponsor and support:
HD.1426/S.890: An Act to guarantee a tenant’s first right of refusal
This bill would give tenants an opportunity to purchase the rental property first when it is put up for sale. This will prevent speculative buyers from decreasing the stock of affordable and subsidized housing for low-income tenants.
Sincerely, [NAME]
2. Use social media!
Follow HFF on Twitter and Facebook to learn more about TOPA. Tweet directly at your Representatives and Senators!
FACT SHEET draft: https://www.canva.com/design/DAEhnbF8D0g/7p6DtsUr8FtmMrTto4bogw/edit
Homes for Families: Opening Doors 