Many homeowners in Philadelphia receive repeated calls, letters, and visits from “We Buy Houses” residential property wholesalers offering cash for their homes or other property they own. Often, these wholesalers target people who are going through financial hardship and use high-pressure tactics to convince homeowners to sign agreements for their homes. They target homeowners in neighborhoods with rising home values, especially in Black and Latinx communities.
These wholesalers often offer far less than the actual value of their property. As a result, long-time homeowners lose valuable wealth and family homes are lost.
On December 1, 2020, Mayor Kenney signed a new law that will curb the worst abuses in this industry.
This new law will:
- Require residential property wholesalers to provide homeowners with a Bill of Rights at least three days before a sale.
- Require residential property wholesalers to be licensed with the City and follow a code of ethics.
- Give homeowners important new rights when residential property wholesalers do not follow the law.
- Create a Do Not Solicit list that homeowners can join if they do not want to receive solicitations to sell their house.
- Assess a fine of up to $2,000 if a wholesaler tries to get homeowners on the Do Not Solicit list to sell their home.
The law is effective February 1, 2021.
Media coverage of this new law:
Inquirer Editorial Board, “Editorial: Philly’s new homeowner protection law is a useful tool for neighborhoods facing gentrification,” Dec. 2, 2020, Philadelphia Inquirer.
Kate Dugan and Tonnetta Graham, “‘Opinion: We buy houses’: Philly Council targets real estate scammers with bill,” Nov. 18, 2020, PlanPhilly/WHYY.
Jacob Adelman, “New city law aims to crack down on real estate ‘wholesalers,’ seen as exploiting underinformed property owners,” Nov. 19, 2020, Philadelphia Inquirer.
Taylor Allen, “Wholesaler or huckster? Philly Council passes bill to curb real estate scammers,” Nov. 19, 2020, PlanPhilly/WHYY.
Michael D’Onofrio, “City Council approves homeowners ‘do not solicit,’ sends bill to Kenney,” Nov. 19, 2020, The Philadelphia Tribune.