Council Supports Tenant First Right of Refusal Legislation

The Council is supporting legislation that would give tenants the first opportunity to purchase their residential buildings when an owner decides to sell. The Council adopted a resolution supporting H.1544 / S.998, An Act to Guarantee a Tenant’s First Right of Refusal, and urging the Massachusetts Legislature to advance and enact the legislation.

Massachusetts is experiencing an affordable housing shortage, while existing rental housing remains vulnerable to conversion, redevelopment, and rent increases that can contribute to the displacement of current residents. The proposed legislation would allow tenants to organize through a tenant association and pursue the purchase of their building, commonly known as a Tenant Opportunity to Purchase Act, or TOPA.

Under the legislation, tenants could pursue a purchase independently or work with qualified partners, including nonprofit organizations, community development corporations, affordable housing developers, or community land trusts. These partners could help tenants secure financing and complete the purchase of their building.

The legislation is intended to help preserve what housing advocates call “naturally occurring affordable housing,” or NOAH. This refers to unsubsidized rental housing that is often more affordable because of factors including the age, size, or condition of a property.

The proposed legislation would establish timelines and procedures for tenants to be notified when a property is being offered for sale and to exercise their purchase opportunity. Property owners would still be able to proceed with a sale to an outside buyer if tenants choose not to purchase the property. The legislation would not require owners to sell at a lower price or on different terms than those offered by a third-party purchaser, instead giving tenants an opportunity to match the third-party offer. It also includes exemptions for certain properties and circumstances, including specified small property owners, certain family transfers, and new construction.

The Council’s resolution states that providing tenants with a meaningful opportunity to purchase their homes could promote housing stability, preserve affordability, reduce displacement, and strengthen neighborhood continuity throughout Boston. The Council expressed its support for H.1544 / S.998 and urged the Massachusetts Legislature to advance and enact the legislation.