According to Mortgage News Daily, a new California law taking effect on January 1st will seek to hinder a repeat of the 1000’s of single-family homes that converted from ownership to rental properties during the “Great Recession.” The new law (formerly SB1079) will reportedly give tenants, affordable housing groups and local governments will get “first crack” at buying foreclosed homes. Interestingly, according to the legislation, the law is only operational between January 1, 2021 and January 1, 2026.
“The California legislation, SB1079, was the brainchild of an activist Oakland group, Moms 4 Housing. It bars sellers of foreclosed homes from bundling them at auction for sale to a single buyer. In addition, it will allow tenants, families, local governments, affordable housing nonprofits and community land trusts 45 days to beat the best auction bid to buy the property. It also creates fines of as much as $2,000 per day for failure to properly maintain properties.”