RUN from First Right of Refusal for MHP Tenants

[Logan M.]

Today, I was on the phone with a commercial agent talking about different state laws that affect MHPs. One common law gives all tenants in a MHP that own their own home first right to purchase the community when a sale presents itself. The idea isn't bad but here are a few problems that start to happen:

1. The amount of time the tenants have to exercise can kill the deal with any buyer. I have heard upwards of 12+ months.

2. To avoid selling homes to others stop creating restrictions on your property.

3. Many times these end up in litigation and can further delay a sale.

4. The organizations that help tenants purchase are far and in between. One of the largest said because of interest rates in 2023 they only closed on one transaction nationwide.

5. Even though it may be unlikely that the tenants can buy the community they can take the full duration of time given.

[Tim Miller]

Maryland past a law for the MHP tenant to have the right of first refusal. If they agree to buy, it can take up to a year before you close. If you don't give the tenants the option to buy, you have to pay a $10,000 fine. I'll pay the fine!