Rentals; resale disclosure; condemnation

These changes are effective on July 1, 2016:


     “Realtor Bill.” HB684 was legislation introduced by Delegate Peace having been requested by the Virginia Association of Realtors. CAI’s Virginia Legislative Action Committee (VALAC) worked very hard to get concessions on this prior to session beginning and sought significant amendments as it went through the process to ensure a fair and balanced approach vs. the original bill which went well beyond the ultimate changes to the statute.  According to the VALAC at the end of the day the bill has a lot of moving parts but does little harm in terms of new policies impacting our group – much of it is clarification of the existing statute or standard practice.  

     HB684, amending Sections 55-79.87:1 and 55-509.3:1 of the Code, provides that unless expressly provided in the Act or the recorded governing documents, an association may not:

   Condition or prohibit the rental of a unit to a tenant by a unit owner or make an assessment or impose a charge, except as provided in 55-79.42:1 of the Act;

   Charge a rental fee, application fee, or other processing fee of any kind in excess of $50 as a condition of approval of such a rental during the term of any lease;

   Charge an annual or monthly rental fee or any other fee not expressly authorized in Section 55-79.42:1 of the Act;

   Require the unit owner to use a lease or a lease addendum prepared by the Association;

   Charge any deposit from the unit owner or the tenant of the unit owner; or

   Have the authority to evict a tenant of any unit owner or to require any unit owner to execute a power of attorney authorizing the unit owners’ association to so evict.

     The statutes now expressly authorizes an owner to designate a person licensed by the Real Estate Board as the owner’s authorized representative with respect to any lease and requires an association to recognize such representation without a formal power of attorney (except in voting matters). 

     The statutes’ changes clarify requirements regarding delivery and receipt of disclosure documents.  The statute with changes noted and highlighted is attached and must be read to be fully understood. Difficult to summarize.

     Finally, the bill conforms the Property Owners’ Association Act to the Condominium Act relating to provisions of disclosure documents in electronic form and charges, removing a loophole created by prior amendments.

     A copy of the bill, annotated, is attached. The highlighted portions are the changes. Italicized words are the new language.

      Condemnation for HOAs. SB 237 (Petersen) – Passed on the last day of session with an amendment. This legislation provides that, for the purposes of condemnation, the value of a portion of a common area of a property owners’ association shall be based on the common area’s highest and best use as though it were free from restriction to sole use as a common area. Some localities including Virginia Beach came out against the bill but got an amendment on it at the 11th hour to ensure it did not trigger an assessment – see here for that amendment At the end of the day the bill is probably helpful to our interests.



NOT PASSED BUT MAY BE BACK (i.e. Close calls)

      AirBnB. Housing Commission study is going to be vital for us to be a part of – VALAC made a prudent amendment on the fly during the General Assembly session so we might think about anything additional/different we might want for legislation that surely will result from the study. The bills that were introduced but not passed (HB812-Peace/SB416-Vogel) would have allowed property owners to rent out their homes or portions thereof for charge for periods of less than 30 consecutive days or do so through a hosting platform, under certain circumstances. The hosting platform may (not shall) in SB812 register with the Department of Taxation, in which case the hosting platform is responsible for the collection and remittance of all applicable taxes on behalf of the property owner. HB416 would have required the hosting platform to register with the Department of Taxation. Here is a link to the bill and our language amendment is on lines 94-100.

      Home Based businesses SB 238 (Petersen) – probably our most significant bill of the session was killed – Tabled in Committee with a letter to the Housing Commission to take a look at it – we drafted the language of the letter for the Chairman that was sent to minimize the scope and intent of the study. Something VALAC is clearly going to need to watch during the summer and next session. Link to the substitute before the committee:

   Best Practices. HB 512 (Bulova) This bill would have required that a developer of  a subdivision which includes an HOA, in order to obtain approval to record the        documents, would be required to certify that he had reviewed the best practices for        the preparation of declarations of restrictions and covenants. 

      Camping Bill. SB 629 (Stanley) – This bill died at the hands of Riley Ingram, the Chairman of Counties, Cities and Towns in the House.   VALAC was able to put an amendment on to protect our interests but localities were fiercely opposed. As drafted it would have prohibited any city or county from barring or requiring a special use permit for camping by a landowner and his family or nonpaying guests in a tent or recreational vehicle on the landowner’s property for a total of no more than two months per year.

      Access for Process Servers. SB 76 (Wexton) – This bill died in Senate Courts Committee. VALAC worked on amendments to the bill to protect our interest in terms of restricting access. Bill as drafted would have required an employee of a common interest community to grant entry into the community to a person attempting to execute service on a party who resides within or is known to be within the community.

      Checking License Plates. HB 1034 (Sickles) – This bill died in the House Finance Committee. Would have required certain entities (e.g., homeowner’s associations and apartment complexes), if requested, to send to the commissioner of the revenue of the county or city in which the entity is located the license plate numbers of their homeowners’ or tenants’ motor vehicles.