89R8414 SCR-D
By: Talarico H.B. No. 2968
A BILL TO BE ENTITLED
AN ACT
relating to single-family homes held by corporate owners for rental
purposes; requiring information by and registration of certain
corporate owners; authorizing a fee and civil penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Subtitle C, Title 5, Business & Commerce Code, is
amended by adding Chapter 121 to read as follows:
CHAPTER 121. REGISTRATION REQUIREMENT FOR CORPORATE OWNERS OF
MULTIPLE SINGLE-FAMILY HOMES
Sec. 121.001. DEFINITIONS. In this chapter:
(1) "Corporate owner" means a corporation, limited or
general partnership, limited liability company, business trust,
investment asset manager, real estate investment trust, joint
venture, joint stock company, or bank that holds an interest in
multiple single-family homes in this state that are offered or used
as a rental property to produce income directly or indirectly from a
residential tenant. The term includes an entity engaged in the
business of investing the pooled capital of investors in financial
securities.
(2) "Governing authority" has the meaning assigned by
Section 1.002, Business Organizations Code.
(3) "Officer" has the meaning assigned by Section
1.002, Business Organizations Code.
(4) "Rental property" means real property used or
intended to be used:
(A) as a primary residence for 30 or more
consecutive days by a residential tenant under an oral or written
lease or rental agreement; or
(B) for occupancy for tourist or transient
accommodations for fewer than 30 consecutive days, where the
property does not serve as a residential tenant's primary
residence.
(5) "Residential tenant" means any person who does not
own but is authorized to use a single-family home in exchange for
consideration paid to a corporate owner or to a third-party lessor,
sublessor, management company, managing agent, or operator of a
hosting platform that derives revenues, including booking fees or
advertising revenues, from providing or maintaining a marketplace
that is used to facilitate the rental of a single-family home.
(6) "Single-family home" means a residential
structure with a yard or public way on not less than two sides that
is separated from any adjacent housing unit by a ground-to-roof
wall, does not share a heating, air-conditioning, or utility system
or a backyard, and does not have a housing unit located above or
below. The term does not include a mobile home or manufactured
home.
Sec. 121.002. REGISTRATION STATEMENT. (a) A corporate
owner that owns single-family homes in this state that are used or
offered for use as a rental property shall register with the
secretary of state by filing a registration statement that
contains:
(1) the name under which the corporate owner conducts
business and the address of the corporate owner;
(2) the state or country of incorporation, formation,
registration, or organization;
(3) the location of the headquarters or principal
office of the corporate owner;
(4) the type of business entity of the corporate
owner;
(5) the number of single-family homes in this state
the corporate owner owns; and
(6) the name and mailing address of an officer or
person serving as part of the governing authority of the corporate
owner.
(b) The secretary of state may charge a reasonable fee for
issuance of a certificate acknowledging registration under this
section.
(c) A registration certificate expires on the first
anniversary of its date of issuance. A corporate owner may renew a
registration certificate by filing a renewal application, in the
form prescribed by the secretary of state, and paying a reasonable
renewal fee in an amount set by the secretary of state.
Sec. 121.003. UPDATE OF REGISTRATION STATEMENT. A
corporate owner shall update information contained in the
registration statement not later than the 60th day after the date on
which the information changes.
Sec. 121.004. CIVIL PENALTY. (a) A corporate owner who
fails to comply with this chapter is liable to this state for a
civil penalty in the amount of $500 for each day of the violation.
(b) The attorney general may bring an action to recover a
civil penalty under this section.
Sec. 121.005. REGISTRY. (a) The secretary of state shall
establish and post on the secretary's Internet website a searchable
registry of corporate owners registered under Section 121.002(a).
(b) The registry must include:
(1) a search feature that allows a person searching
the registry to identify a specific corporate owner; and
(2) for each corporate owner, the information in the
registration statement filed under Section 121.002(a).
Sec. 121.006. RULES. The secretary of state shall adopt the
rules necessary to implement this chapter.
SECTION 2. Subchapter C, Chapter 86, Education Code, is
amended by adding Section 86.531 to read as follows:
Sec. 86.531. ANNUAL STUDY AND REPORT ON SINGLE-FAMILY HOME
PURCHASES, RENTALS, AND SALES BY CERTAIN CORPORATE OWNERS. (a) In
this section, "corporate owner," "rental property," and
"single-family home" have the meanings assigned by Section 121.001,
Business & Commerce Code.
(b) Using existing available data, including data from the
secretary of state, and deed records, the center shall compile
information related to corporate owners' purchases, rentals, and
sales of single-family homes in this state for each calendar year.
The information must include:
(1) the number of single-family homes each corporate
owner had an interest in during the calendar year;
(2) the number of single-family homes purchased by
each corporate owner during the calendar year and the total number
purchased in each county and municipality;
(3) the number of single-family homes described by
Subdivisions (1) and (2) acquired through foreclosure;
(4) the number of single-family homes described by
Subdivisions (1) and (2) sold by each corporate owner during the
calendar year;
(5) the number of single-family homes described by
Subdivisions (1) and (2) used as a rental property during the
calendar year;
(6) the municipality and county in which each
single-family home described by Subdivisions (1) and (2) is
located;
(7) the appraised value of each single-family home
described by Subdivisions (1) and (2);
(8) the name, assumed name, business association type,
registered office address, telephone number, and registered agent
of each corporate owner of a single-family home; and
(9) the name, address, and contact information for the
landlord or third-party lessor, sublessor, management company, or
managing agent of each single-family home described by Subdivision
(5).
(c) In addition to the information required by Subsection
(b), the center may compile additional information at the
recommendation of the legislature or that the center determines is
relevant based on market trends.
(d) Not later than June 1 of each year, the center shall
submit a report to the lieutenant governor, the speaker of the house
of representatives, and each member of the legislature. The report
must contain:
(1) a summary of the information compiled under
Subsection (b) for the preceding calendar year;
(2) an assessment of any trends or patterns relating
to the relative number of purchases by corporate owners, including
whether the corporate owners may be classified into any readily
observable groups based on the number of purchases or other
appropriate criteria; and
(3) an analysis of:
(A) the impact of corporate owners on the cost of
housing;
(B) any advantages and disadvantages corporate
owners have over individual buyers in the real estate market;
(C) the impact of corporate owners on the cost
and availability of single-family home rentals; and
(D) the impact of corporate owners on the
availability of single-family homes for purchase.
(e) After completing the initial report under this section,
the center may compile information from any calendar years
preceding 2025 to create and submit reports for those years that
include the information listed in Subsections (b) and (d).
SECTION 3. Chapter 12, Property Code, is amended by adding
Section 12.00125 to read as follows:
Sec. 12.00125. INSTRUMENTS CONCERNING SINGLE-FAMILY HOMES
PURCHASED BY CORPORATE OWNERS. (a) In this section, "corporate
owner" and "single-family home" have the meanings assigned by
Section 121.001, Business & Commerce Code.
(b) If a corporate owner purchases a single-family home in
this state, the county clerk in the county in which the
single-family home is located may not record an instrument
conveying title to the home unless:
(1) the corporate owner provides to the county clerk a
copy of the registration certificate issued under Section 121.002,
Business & Commerce Code;
(2) the name of the grantee on the instrument
conveying title to the home matches the name of the corporate owner
on the registration certificate;
(3) the instrument conveying title to the home:
(A) contains the name and mailing address of an
officer or governing person of the corporate owner; and
(B) clearly states that the single-family home is
not the primary residence of the grantee; and
(4) the corporate owner provides to the county clerk a
sworn affidavit signed by a duly authorized officer or agent of the
corporate owner stating that the information required to be
included in the instrument conveying title under Subdivision (3) is
also included in the corporate owner registry established under
Section 121.005, Business & Commerce Code.
SECTION 4. As soon as practicable after the effective date
of this Act, the Texas Real Estate Research Center at Texas A&M
University shall take any actions necessary to implement Section
86.531, Education Code, as added by this Act, and submit the initial
report required under Section 86.531(d), Education Code, as added
by this Act, not later than June 1, 2026.
SECTION 5. (a) As soon as practicable after the effective
date of this Act, the secretary of state shall adopt rules necessary
to implement Chapter 121, Business & Commerce Code, as added by this
Act.
(b) Notwithstanding Section 121.002, Business & Commerce
Code, as added by this Act, a corporate owner is not required to
comply with that section until January 1, 2026.
SECTION 6. (a) Except as provided by Subsection (b) of this
section, this Act takes effect September 1, 2025.
(b) Section 12.00125, Property Code, as added by this Act,
takes effect February 1, 2026.