CT Multi-Family Purchase Disclosure Requirement
Connecticut Creates Mandatory Disclosure Place Buyers of Multi-Family Real Estate On Notice of Equal Opportunity Housing Laws
We live in a heavily regulated legal landscape. Often we perform a task we think is relatively simple, but it may expose us to a host of legal issues, some of which we may not even be aware of. However, as the old saying goes, “ignorance of the law is no excuse”.
In an attempt to weed out some of the lack of understanding in housing laws, the Connecticut Senate passed Public Act No. 16-16, AN ACT CONCERNING THE DISCLOSURE OF HOUSING DISCRIMINATION AND FAIR HOUSING LAWS, which went into effect on September 1st, 2016.
The law creates a mandatory disclosure that must be PROVIDED BY THE SELLER and SIGNED BY THE BUYER any time a multifamily property is bought/sold.
What is a Multi-Family Property?
A multifamily property is any piece of residential real estate containing two or more units. These are very popular in cities and big towns such as Danbury, Waterbury, Stamford, Norwalk, etc. They are often bought by real estate investors who rent the individual units out to tenants.
What is in the Multi-Family Disclosure?
The disclosure places the Buyer on notice of State and Federal fair housing laws. It notifies the Buyer that race, color, national origin, ancestry, sex, creed/religion, disability, family status, source of income, sexual orientation, gender identity and expression, age and marital status are all Protected Classes for which it is illegal to discriminate against in the housing market.
Further, it gives examples of fair housing violations based on those protected classes:
- Refusing to rent, sell or show the dwelling;
- Steering towards certain neighborhoods;
- Increasing security deposits;
- Requiring “employment” when other legal sources of income exist;
- Failure to negotiate or refusal of rent based on source of income;
- Refusing to waive “no pet” policies for tenants with disabilities; and
- Refusing to allow tenants with disabilities to build a ramp.
What needs to be done with the Multi-Family Disclosure?
Idealy, the Multi-Family Disclosure will be attached by the Seller to the Purchase and Sale Agreement, Exchange Agreement, or Lease with Option to Buy. The Multi-Family Disclosure is then signed by the Buyer when signing the agreement/contract. However, the Public Act specifically protects the validity of Agreements where the Seller does not attach the Multi-Family Disclosure; those contract with still be enforceable.
If the Multi-Family Disclosure is not attached to the contract, it must be signed before or at closing on the multi-family property.
Where Can Realtors and Sellers get a copy of the Multi-Family Disclosure?
The Multi-Family Disclosure can be found on the Commission for Human Rights and Opportunities website, and is also attached hereto in JPEG format.