UrbanTurf recently got a question from a reader that piqued our interest: Can a tenant sell his or her right of first refusal, the provision of the Tenant Opportunity to Purchase Act that lets tenants make and match offers on the property they live in when a landlord decides to sell?
Here’s the question from our reader:
“I presently rent the English basement apartment of a rowhouse in Columbia Heights. My landlord — who lived in the main house above me — passed away unexpectedly. I received my formal offer to purchase today. If I’m not interested in or able to purchase the house, is it legal to sell away my right of refusal? That is, if there’s someone who is interested in purchasing, is it legal to enter into a formal agreement, so that I may make a profit on turning over the right?”
Aaron Sokolow, an attorney at Battino & Sokolow in DC, told UrbanTurf that the tenant’s answer is a definite yes.
“It’s done all the time,” Sokolow said. “The advantages are that the tenant can be in control of the situation even if the tenant doesn’t have the ability or the desire to go through with the purchase themselves.”
The right can be purchased in exchange for money, a guarantee that the tenant can stay in the apartment or another arrangement with the purchaser. But usually, Sokolow said, the exchange is in cash. The cash value of the right can vary enormously depending on how desirable the property is, and prices usually spike the most when the property is being eyed by investors.
“I’ve seen it run the full spectrum, from $50 to the high tens of thousands of dollars,” Sokolow told UrbanTurf. “It’s case-by-case, but development opportunity, that’s the big variable for valuation of properties in DC.”
This article originally published at http://dc.urbanturf.com/articles/blog/can_you_sell_your_right_of_first_refusal/9779
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