Differences in How the Law Applies to “Large” & “Small” Landlords
July 21, 2021
The number of properties a landlord owns in Virginia has become a much bigger deal over the past couple of years as the General Assembly has created some important differences in how the law is applied to large landlords versus smaller landlords. For the purposes of all the laws discussed here, a “Small Landlord” is one who owns four or fewer rental properties in Virginia. “Large Landlords,” conversely, are those who own (or have at least a 10-percent ownership interest in) five or more rental properties in Virginia.
Fair Housing – Source of Funds
The General Assembly passed legislation in 2020 adding “source of funds” to the list of protected classes in the Virginia Fair Housing Law. This most notably impacts landlords who are dealing with tenants who intend to pay for their housing using some form of housing voucher (commonly referred to as Section 8 vouchers). The law provides an exemption to this law for Small Landlords, meaning that a landlord who owns between one and four properties in Virginia may deny an applicant based on the fact that they propose to use Section 8 vouchers to pay some or all of the rent.
Code Section 55.1-1245 – 14-day notice for nonpayment of rent
This provision of the code was originally set to expire on July 1, 2021. However, a bill passed by the General Assembly this year has extended the provision for another year at least. Both Small and Large Landlords must still provide a 14-day notice before terminating a rental agreement on the basis of unpaid rent. For Large Landlords, that notice must also offer the tenant the option of entering into a payment plan over six months or the remaining lease term, whichever is shorter. The plan can’t include late fees, and no late fees may be charged during the time the tenant is making payments.
Code section 55.1-1245 – Adverse action based on eviction during the pandemic
Large Landlords may not take adverse action against an applicant based solely on payment history or an eviction for nonpayment of rent between March 12, 2020, and 30 days after the expiration of the Virginia state of emergency related to the COVID-19 pandemic. Based on the current end date of June 30, 2021, that would mean this protection extends for evictions/nonpayment of rent through the end of July, 2021.
Code section 55.1-1250 – Right of Redemption (Effective July 1, 2021)
Tenants who live in properties owned by Large Landlords may exercise their right of redemption (paying all overdue rent, along with any damages, judgments, attorney fees, or court costs) as many times as they want during the course of a lease term. Tenants who live in properties owned by Small Landlords are still restricted to using the right of redemption to once per lease period.
If you have any questions regarding any of these distinctions, we encourage you to contact the Virginia REALTORS® Legal Hotline.
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