TOPA and the inherited DC rental

If someone is living in the property you inherited, the District's Tenant Opportunity to Purchase Act may require you to offer it to them before you can sell it to anyone else. A sale that violates TOPA can be undone — which makes this the one thing you genuinely must resolve before listing.

What TOPA is

Under D.C. Code § 42–3404.02, before the owner of a housing accommodation may sell it, the owner must give the tenant an opportunity to purchase it at a price and terms representing a bona fide offer of sale. In practice it is a statutory right of first refusal with prescribed notices and timelines.

It applies to the property, not to the person — so it survives the death of the owner and lands squarely on the estate. It is administered through DHCD's Rental Conversion and Sale Division, and the consequences of ignoring it are serious: a tenant can seek to have a completed sale set aside.

Inheriting is generally not a "sale"

This is the piece that reassures most families, and it is worth stating precisely. D.C. Code § 42–3404.02b(b)(1)(A) provides that the term "sell" or "sale" does not include a transfer, even for consideration, by a decedent's estate to members of the decedent's family, an heir, or a legatee. The statute defines family to include a surviving spouse or domestic partner, lineal descendants and their spouses, and certain trusts and entities controlled by them.

So the property passing from the estate to the heirs does not by itself trigger a tenant's right to purchase. Note that a Notice of Transfer may still be required under § 42–3404.03a even where an opportunity to purchase is not.

The 2018 single-family exemption

The most important change in recent memory. Under the TOPA Single-Family Home Exemption Amendment Act (D.C. Law 22-120, effective July 3, 2018), codified at § 42–3404.09, single-family accommodations are exempt from the subchapter except as that section provides.

A "single-family accommodation" under § 42–3401.03(16A) means a housing accommodation containing one single-family dwelling, or one single-family dwelling with one accessory dwelling unit, or a single rental unit in a condominium, cooperative or homeowners association. That covers a very large share of inherited DC rentals — the row house rented to one family, the house with a basement English apartment, the single inherited condo unit.

Two obligations survive the exemption, and both catch people:

1. The 3-day notice. Within 3 calendar days of receiving or soliciting a written offer to purchase, an owner with intent to sell must deliver written notice to the tenant that an offer was received or solicited. The exemption removes the right to purchase; it does not remove this notice.
2. The elderly and disabled carve-out. If the tenant is an elderly tenant (62 or older) or a tenant with a disability as of the date of the offer of sale, and signed a rental agreement by March 31, 2018 and took occupancy by April 15, 2018, TOPA still applies to them, as modified by § 42–3404.09. The owner may deliver a written notice of intent to sell to establish status, and the tenant has 20 days to respond with documentation. DHCD's Rental Conversion and Sale Division determines status.

In Lashawn Lane v. District of Columbia Department of Housing and Community Development (D.C. Court of Appeals, 2024), the court confirmed the exemption applies to tenants of single-family properties regardless of when the tenancy began — only elderly or disabled tenants meeting those 2018 dates retain the right to match an offer.

Two to four units — the detail almost everyone misses

Many inherited DC properties are small multi-unit buildings: a converted row house with two or three units, a duplex with a rented basement. Here § 42–3404.10 does something surprising.

Subsection (a) applies the 2-through-4-unit procedures to accommodations owned in majority by a business corporation, other than 2-unit single-family accommodations. Subsection (b) then provides that accommodations with 2 through 4 units that are not majority-owned by such a corporation are exempt from the subchapter, except that their tenants are entitled to the notice and rights in § 42–3404.09(b) — that same 3-day notice.

Where the full 2–4 unit procedure does apply, the statutory rhythm is: tenants acting jointly have 15 days to deliver a written statement of interest, then an individual tenant has a further 7 days; the owner must allow at least 90 days to negotiate a contract, plus a further 30-day period for an individual tenant; at least 90 days before settlement to secure financing, extendable to 120 on a lender's written estimate; and if 240 days pass from a valid offer without a sale or contract, the owner must comply anew.

Five or more units

Rarer in an estate, and much slower. Under § 42–3404.11 the tenants must form a tenant organization with legal capacity to hold real property, elect officers, adopt bylaws, file articles of incorporation, and deliver a registration application to the Mayor and owner within 45 days of receipt of a valid offer — 30 days if a suitable organization already exists. The owner must then allow at least 120 days from receipt of the registration statement to negotiate. If 360 days elapse from a valid offer without a sale or contract, the owner complies anew.

If an estate holds a five-plus-unit building, plan on the better part of a year and price the delay into every decision.

Where estates get caught

• "There's no lease, so there's no tenant." A tenant under § 42–3401.03(17) is anyone entitled to possession, occupancy or the benefits of a rental unit. Oral tenancies count. A relative who has lived there for years and pays something may well count.
• Assuming the single-family exemption without checking the tenant. If the tenant is elderly or disabled and met the 2018 lease and occupancy dates, they retain rights. Verify status through the statutory notice process rather than assuming.
• Skipping the 3-day notice because the property is exempt. The notice obligation is part of the exemption, not an alternative to it.
• Not knowing the unit count the District thinks you have. What the family calls a single-family house with a basement apartment may be recorded differently. Check.
• Marketing before the analysis. Rights vest on receipt of an offer of sale under § 42–3404.02(f). Getting the sequence wrong is how sales get unwound.

What to do, in order

1. Establish whether anyone occupies the property — lease or no lease, rent or no rent.
2. Establish the unit count as the District records it.
3. Establish the tenant's age and disability status, and when they signed and took occupancy, through the statutory notice process.
4. Retain a DC real estate attorney before any offer is solicited or received. This is not a step to economise on.
5. Then price and market the property, with the required notices built into the timeline from the start.

Related: selling an inherited house in DC and selling estate property as a personal representative.

Sources: D.C. Code §§ 42–3401.03, 42–3404.02, 42–3404.02b, 42–3404.03a, 42–3404.09, 42–3404.10 and 42–3404.11; D.C. Law 22-120, the TOPA Single-Family Home Exemption Amendment Act of 2018; DHCD Rental Conversion and Sale Division guidance; and Lashawn Lane v. D.C. Dept. of Housing and Community Development (D.C. 2024). TOPA is amended frequently and applies differently to nearly every property — confirm everything here with a DC real estate attorney before acting.