Recent changes to the Tenant Opportunity to Purchase Act (TOPA) mean that single-family rental properties are now exempt from TOPA – except in very specific circumstances. In general, this means if you’re the owner of a single-family rental property, you no longer have to give your tenants a good faith offer to buy the property prior to making a deal with another purchaser. Some rules and exceptions still apply though. In this article, we provide details and clarification to help you navigate the TOPA changes with minimal headaches!

Giving Notice

If you decide to sell your single-family rental property or receive an offer you’re considering, you’re obligated to notify the current occupants. This notification must be delivered in writing within 3 calendar days of listing the property or receiving an unsolicited purchase offer on the property, which you wish to accept.

It’s important to note that once the “Notice to Tenant and Notice of Intent to Sell” form (Form 1) has been delivered to the tenant(s), you won’t have to deliver the form again to the same tenants for one year, even if you receive additional offers for the property or choose to re-list it after a failed deal. However, if more than one year passes, you must provide a new Form 1 to the tenant(s) following the same timeline as the first notice.

Under the new TOPA amendments, the tenants in the dwelling have no legal right of refusal or opportunity to purchase. However, under DC law, tenants can elect to continue renting month-to-month after their lease expires, which can potentially complicate the sale process. If necessary, the tenants may have to be evicted, which can be a complex ordeal given the landlord-tenant laws in DC.


While most single-family property tenants no longer have TOPA rights, there are exceptions. Tenants who qualify as elderly or disabled, signed their lease on or before March 31, 2018, and took occupancy by April 15, 2018 will have a limited opportunity to exercise their right to purchase or to assign their rights to another buyer. If tenants receive written notification of the intent to solicit or accept a purchase offer and wish to claim status as elderly or disabled, they have 20 days to submit “Letter to Landlord” (Form 2) indicating that they are claiming such status.

As the landlord, once you receive this notice, you are required to submit a written Offer of Sale to the tenants. The tenants then have another 20 days to submit “Response Letter to DHCD and elderly/disability documentation to DHCD” (Form 4) indicating their intent to exercise their TOPA rights to either purchase the property or transfer their purchase rights to another buyer or developer.

Once you receive the Statement of Interest from the tenants, there is a 25-day period during which you and the tenant may negotiate sale terms, followed by a financing period that gives the tenant an additional 45 days (which may be extended to 75 days) to obtain financing for the purchase.

Another change from the previous version of TOPA is that tenants may not receive financial payment for assigning TOPA rights other than a 12-month extension of tenancy at the same rental rate. This means that the new law prohibits bargains in which tenants receive financial gain for assigning their TOPA rights to a developer or other property investor.

Things to Consider

While TOPA lists several ways that notice can be given to tenants, different underwriting companies may have specific guidelines for delivering written notice. For example, our underwriter First American prefers delivery by certified mail or an overnight service that provides delivery confirmation. If you’re a property owner, you may want to check with your title company for any specific delivery requirements they may have. Even if they don’t require delivery confirmation, you may want to use a delivery method that includes confirmation. This will give you a clear paper trail if you need to provide proof of delivery dates at any point in the process.

Additionally, while the law doesn’t require it, some underwriters like First American are also likely to require the tenant to verify in writing that either they are not elderly/disabled or they are choosing to waive their TOPA rights. Again, even if your underwriter doesn’t require it, you should consider it anyway. Having a written waiver or affirmation will provide added protection against any hold-out tenants who want money or are hoping to stop the sale of your property. It’s likely that each underwriter will work a little differently in this area and many transactions will have to be handled on a case-by-case basis.

The TOPA modifications are still a work in progress, which accounts for some inconsistencies currently found in the required forms. We’re hopeful that these inconsistencies will be fixed quickly, but you may want to review the forms and address any concerns you have, if you think you might need to use them in the near future.

With all of these changes taking place and the continued re-working of the law and accompanying forms, consider consulting with a settlement company like Prime Settlement before selling your single-family rental property. We’re working to stay on top of these changes so we can help you make the best decisions possible when you’re selling your single-family property.

For more detailed information on the new TOPA laws, register to attend the Prime Settlement TOPA workshops in September. These are designed to help you better understand and exercise your rights under TOPA so that you can be TOPA compliant and/or better inform your clients. Contact us today for more information and to sign up!