TMHA Offers Community Members Option Right of First Refusal Form
TMHA has worked with outside counsel to create an optional form that can be used as an addendum to TMHA’s existing Manufactured Home Space Lease Agreement. The addendum creates an additional contractual relationship and process in the event a homeowner decides to sell his or her home that resides in a community.
Many community owners have asked for a mechanism so that they are given the opportunity to purchase a home for sale before it is sold to another buyer who will relocate the home away from the community.
The Right of First Refusal Agreement lays out the process whereby a homeowner who intends to sell his or her home provides a notice of a prospective sale to the community owner, with evidence of the potential sale in the form of a purchaser’s written offer, purchase agreement, or bill of sale. The community owner then has two days to decide whether to purchase the home to maintain its location in the community. If the community owner decides to purchase the home, the community owner can do so by purchasing the home for $500 over the other agreed purchase price between the homeowner and other prospective buyer.
The intent of this optional agreement is to give the community owner a final chance to purchase the home slightly above asking price. The slightly above asking price provides an additional financial incentive to the homeowner to make sure the community owner is afforded an opportunity to decide whether to purchase the home. The above asking price purchase price should also reduce accusations that a community owner coerced a tenant, or improperly influenced or forced a tenant to sell his or her home to the community owner at a below market price.
The agreement is between the community owner and the tenant. If the tenant sells a home that is relocated out of a community without providing the notice to the community owner, the breach is between the tenant and the community owner. The community owner’s recourse against third-party purchaser may be limited and a community owner may not be able to prevent the sale to a third-party. Again, this is why TMHA developed a financial incentive in the form of the slightly more than asking price purchase price so that it is in the best interest of the homeowner to notify the community owner of the prospective sale and allow the community owner to determine whether to purchase the home.
>> View the new Right of First Refusal Agreement