Chapter 6.28 SALE OF RENTAL FACILITIES—NOTICE AND DISCLOSURE REQUIREMENTS*

Chapter 6.28
SALE OF RENTAL FACILITIES—NOTICE AND DISCLOSURE REQUIREMENTS*

Sections:

* Legislative History: Ord. No. 1999-41, 1/1/2000.

Editor’s Note: The title of Ch. 6.28 was amended by Ord. 2007-8.

6.28.010 Contract of sale requirements.

A. On or before entering into a contract for the sale of a rental facility, the owner or agent of the rental facility shall provide the prospective purchaser with the following:

1. A notice of City of Takoma Park rental housing laws (“notice”), a form of which shall be provided by the City and containing such information as necessary to administer and enforce the provisions of this chapter, shall be included in or attached to all contracts of sale for a rental facility;

2. Copies of the annual rent stabilization reports for the rental facility for the previous two years unless the rental facility is exempt from rent stabilization in accordance with Chapter 6.20, Rent Stabilization, and a certificate of exemption is attached to the contract of sale in accordance with subsection (F) of this section; and

3. Copies of available licensing inspection reports of the rental facility for the previous two years.

B. At the time the notice and documents listed in subsection (A) of this section are delivered, each purchaser shall sign and date a written acknowledgment of receipt of the notice and shall initial each rent stabilization report and licensing inspection report. The notice shall be included in or attached to the contract of sale for the rental facility and the reports shall be attached to the contract of sale.

C. A purchaser of a rental facility has the right, upon written notice to the seller or seller’s agent:

1. To rescind the contract of sale at any time before the receipt of the notice, rent reports, and inspection reports or within five calendar days following receipt of the notice, rent stabilization reports, and licensing inspection reports of the rental facility; and

2. To the immediate return of any deposits made on account of the contract of sale.

D. Unavailability of Rent Stabilization or Licensing Inspection Reports—Failure to Provide Reports.

1. If the owner or agent of the rental facility has not filed all required rent stabilization reports with the City, or has filed rent stabilization reports with inaccurate or incomplete information, or a licensing inspection has not been completed, the owner or agent of the rental facility shall promptly file or correct required rent reports and/or provide the purchaser with access to the rental facility for purposes of performing a pre-purchase inspection. Copies of such reports or corrected reports shall be provided to the purchaser as soon as the rent stabilization reports are prepared and filed with the City.

2. The purchaser’s right to rescind the contract shall continue until the owner or agent of the rental facility has provided the required notice and complete and accurate rent stabilization reports to the purchaser. In the event that settlement on the transfer of title to the rental facility has occurred, then the purchaser may seek an order from a court of competent jurisdiction declaring any transfer in which the owner or agent has not complied with all requirements of this chapter void and the transfer documents set aside.

E. Waiver of Purchaser’s Rights.

1. The rights of a purchaser under this section may not be waived in the contract of sale and any attempted waiver is void.

2. Except as stated in subsection (D) of this section, any rights of a purchaser who has received the notice and complete and accurate rent stabilization reports and available licensing inspection reports for the two years immediately preceding the sale to terminate the contract of sale for the rental facility are waived conclusively if not exercised before settlement on the transfer of title to the purchaser.

F. If a rental facility is exempt from rent stabilization, then a certification of exemption from the City of Takoma Park shall be attached to the contract of sale. The owner or agent shall not be required to provide copies of the rent stabilization reports for a rental facility that is not subject to rent stabilization and the purchaser shall not have the right to terminate the contract of sale for failure to receive copies of the annual rent reports for the previous two years.

G. The notice and disclosure requirements established by this chapter do not apply to:

1. A sheriff’s sale, tax sale, deed in lieu of foreclosure, or sale by foreclosure, partition, or by court-appointed trustee;

2. A transfer of the rental facility by a fiduciary in the course of the administration of a decedent’s estate, guardianship, conservatorship or trust;

3. A transfer of the rental facility or any interest therein to a spouse, former spouse, domestic partner, former domestic partner, parent, sibling, child or grandchild; or

4. A transfer of a single-family rental facility to a purchaser who stipulates in the contract of sale that the property will not be used for rental purposes. It will be the responsibility of the purchaser of the single-family rental facility to notify the City, within 15 business days after transfer of title to the property, of the discontinuance of use of the property as a rental facility. (Ord. 2013-25 § 1, 2013/Ord. 2007-8, 2007: Ord. 2003-7 § 1 (part), 2003: prior code § 6-700)

6.28.020 Transfer of rental license.

A purchaser, transferee or owner of a rental facility shall apply to the City for a rental housing license, or for the transfer of the existing rental housing license, for the rental facility within 15 calendar days after acquiring title to the rental facility. The procedures and requirements for rental licenses are set forth in Chapter 6.08, as amended from time to time. (Ord. 2013-25 § 1, 2013/Ord. 2003-7 § 1 (part), 2003: prior code § 6-704. Formerly 6.28.050)