BILL NUMBER: S5642
SPONSOR: BAILEY
 
TITLE OF BILL:
An act to amend the real property law, in relation to requiring a sworn
affidavit stating the seller was informed of the fair market value of
the property be included in the real property transfer form
 
PURPOSE:
To end predatory speculation in New York State's real estate markets by
requiring purchasers of residential real property to disclose to the
seller of residential real property its fair market value.
 
SUMMARY OF PROVISIONS:
Section 1: Subparagraphs 7 and 8 of paragraph ii of subdivision 1-e of
section 333 of the real property law, as amended by section 1 of part B
of chapter 57 of the laws of 2004, are amended and a new subparagraph 9
is added.
 
JUSTIFICATION:
According to an investigative series published by The City in 2022 and
2023, communities in the New York State are experiencing a rise in
predatory real estate speculation that specifically targets properties
in historically Black and Latino neighborhoods. These real estate specu-
lators target neighborhoods where real estate is rapidly appreciating
and longtime homeowners often die without wills, which can leave a scat-
tering of heirs whose fractional interests speculators can pursue for
purchase.
Once speculators identify a property to target, they reach out to the
shareholders furthest from the property - many of whom do not know they
had even inherited a share of the property or what it is worth - and
offer to buy the share well below what it is actually worth. Once a
share or multiple shares are acquired, under state law the speculators
can bring the remaining shareholders to court and force the sale of the
property, again paying below the fair market value of the home, pushing
out the shareholders who live under the roof, and then selling the prop-
erty for many times what they paid for it.
The intent of this bill is to address this form of predatory real estate
speculation by requiring the buyer to inform the seller of the proper-
ty's fair market value.
 
LEGISLATIVE HISTORY:
2023-24: S8848 - Referred to Judiciary
 
FISCAL IMPLICATIONS:
None.
 
EFFECTIVE DATE:
This act shall take effect on the one hundredth and eightieth day after
it shall have become law.