Housing Licensing and TOPA in the District of Columbia

Recent changes to the Tenant Opportunity to Purchase Act (TOPA) in the District of Columbia have had broad repercussions in the single-family rental market. Since TOPA’s inception, the competing purposes of maintaining a rental market and encouraging tenants to leave the rental market and become homeowners have resulted in a structure that is difficult to follow and has unpredictable results. The failure of TOPA to achieve either result was demonstrated in recent public hearings where it was determined that only a miniscule number of tenants actually purchased the properties presented to them.

The changes to TOPA became effective July 3, 2018. Single family dwellings are, with limited exceptions, no longer subject to almost all TOPA requirements. Single family dwellings include a house with a basement apartment or carriage house, but would exclude a building with two equal rental units. Exceptions are provided to elderly or disabled persons who occupied the property prior to April 15, 2018 and who are able to demonstrate their age or disability within certain time frames. The DC Department of Housing and Community Development (DHCD) continues to be charged with the administration of TOPA policies and recently issued new forms to address the changes. The D.C. Land Title Association has submitted recommendations for additional changes to the forms.

Other recent changes in TOPA clarify issues that have been problematic such as: how to deliver notices (overnight services, such as FedEx, are now permitted) and how to establish when time periods start and end relating to deadlines.  For example, it is now easier to measure the 20 days within which a tenant has to supply to DHCD information about disability

What has not changed are the District’s requirements for licensing and registration as a housing accommodation.

For single-family accommodations, no certificate of occupancy is required. All others must have a certificate of occupancy before a license will be issued.

All landlords of rental properties – including single family dwellings – are required to have a type of Basic Business License called a Residential Housing Rental License. The application will trigger inspections. Single and two-family accommodations will have a more cursory safety inspection by the D.C. Department of Consumer and Regulatory Affairs. Buildings with a higher number of units will require different, proactive inspections.

Rental properties need to be registered with the D.C. Accommodations Division, which is part of DHCD. In certain situations, the property may be exempt from rent control, but either way, there must be an application on file. There is no exemption unless you apply for it. Exemptions may apply if:

  1. The unit was constructed after December 31, 1975.
  2. There are four or fewer units in the building or that the owner is made up of less than four natural persons who own fewer than four units. As of now, that means that units owned by revocable trusts or LLCs are not exempt.
  3. Building has been vacant since January 1, 1985.
  4. Four or fewer rental units in the same housing accommodation, or an aggregate of four rental units in more than one structure in the District of Columbia, so long as the housing accommodation is owned by four or fewer natural persons. (D.C. OFFICIAL CODE § 42-3502.05(a)(3) (Supp. 2008)).

Landlords are also required to produce documentation to tenants which includes the registration of the property with DHCD. If the property was built before 1978, landlords should be basically familiar with lead laws in the District and the appropriate lead disclosure forms should be part of any lease.

There are other articles on Jackson & Campbell, P.C.’s blog dealing with the types of insurance available to landlords.

With all the requirements, many landlords rely upon the services of professional property managers who stay abreast of the requirements and changes and update the lease application and forms, as needed.