Rental Property Owners Feared Disruption of Rental Property Market by Allowing Tenants Right to Purchase For-Sale Income Properties
In the wee morning hours of the last legislative session at 4AM, Massachusetts legislators passed House Bill H.B.5250 “An Act enabling partnerships for growth,” which included a controversial provision giving tenants the right to purchase (also knowns as a right of first refusal) rental property when owners put it up for sale. It also included a provision allowing for tenant eviction records to be sealed from public view. Publicly available records have been part of landlords’ application screening tools for many years now. After intense lobbying by the real estate industry, Gov. Baker vetoed both measures.
The Tenant Right to Purchase (TOPA) provision would have given tenants a right of first refusal to purchase for-sale rental and multi-family properties throughout the state, with some limited exceptions. Such a measure has been a disaster in Washington DC with a cottage industry created to essentially shakedown landlords for money and hold up sales. In his veto proclamation, Gov. Baker stated that “these requirements would significantly delay the sale of multifamily homes throughout the Commonwealth, and potentially chill the production of new housing when we desperately need to produce more. Because a viable exit strategy often is critical to a developer’s willingness to undertake a project, I am concerned that making multifamily sales more unpredictable will result in less investment and construction of fewer new rental units.”
The Eviction Sealing measure would have given tenants the ability to seal their eviction records from public view. The problem with this measure is it was too broad, applying to both no-fault cases as well as certain “for cause” cases which may have involved situations with criminal or drug activity or the endangerment of other tenants. As Gov. Baker stated in…