SB1079: What It Is and How It Helps California Tenants and Affordable Housing Organizations
In California, the process of foreclosing on a property can be devastating for tenants and families who may be displaced as a result. However, a new law called SB1079 aims to give tenants and affordable housing organizations the opportunity to purchase foreclosed properties before they are sold to investors, helping to preserve affordable housing and prevent displacement.
What is SB1079?
SB1079 is a state law that went into effect on September 15, 2020. It requires the new owner of a foreclosed residential property in California to give tenants and affordable housing organizations the right to purchase the property at a fair price. The purpose of the law is to prevent the displacement of tenants and promote the preservation of affordable housing.
Under SB1079, when a residential property is foreclosed upon in California, the new owner must provide tenants with notice of their right to purchase the property. The new owner must also give affordable housing organizations the right to make an offer to purchase the property, and must provide them with information about the fair market value of the property.
If tenants or affordable housing organizations exercise their right to purchase the property, the new owner must sell the property at a fair price within 45 days. The law also prohibits the new owner from reselling the property for a period of 180 days, giving tenants and affordable housing organizations the opportunity to purchase the property without competition from investors.
Why was SB1079 enacted?
SB1079 was enacted to address a problem in California’s housing market. When a property is foreclosed upon, it is often sold to investors who may not have the best interests of tenants or the community in mind. This can result in the displacement of tenants, the loss of affordable housing, and the gentrification of neighborhoods.
By giving tenants and affordable housing organizations the opportunity to purchase foreclosed properties, SB1079 helps to preserve affordable housing, prevent displacement, and promote community stability. The law also promotes transparency and fairness in the foreclosure process by requiring the new owner to provide information about the fair market value of the property.
What are the criticisms of SB1079?
While SB1079 has been praised for its efforts to protect tenants and promote affordable housing, it has also faced criticism from some who argue that it could make it more difficult for lenders to sell foreclosed properties and may lead to a reduction in the availability of credit for homebuyers.
Critics also argue that the law could result in a slower recovery of the housing market in California, particularly in areas where foreclosures are more prevalent. However, supporters of SB1079 maintain that the law provides much-needed protections for tenants and affordable housing organizations, and that it will ultimately benefit the state by promoting community stability and preventing displacement.
In conclusion, SB1079 is an important law that provides protections for tenants and affordable housing organizations in California. By giving them the opportunity to purchase foreclosed properties, the law helps to preserve affordable housing, prevent displacement, and promote community stability. While it has faced criticism from some, it has also been praised for its efforts to address the housing crisis in California and promote fairness and transparency in the foreclosure process.