S1038

An Act concerning sales of certain single-family homes, and supplementing P.L.1975, c.217 (C.52:27D-119 et seq.).

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. As used in P.L. , c. (C. ) (pending before the Legislature as this bill):

“Commissioner” means the Commissioner of Community Affairs.

“Short-term reseller” means a single-family homeowner, including any person, firm, corporation, bank as defined pursuant to P.L.1975, c.265 (C.17:16E-1 et seq.), or other entity who (1) purchased a single-family home; (2) renovated, enlarged, repaired, or in any way altered the home; and (3) offered the home for resale within one year of the receipt of the certificate of occupancy.

“Single-family home” means a detached private residential structure serving as the primary residence for a short-term reseller.

2. a. After the sale of a single-family home by a short-term reseller to the buyer, the reseller shall retain in escrow, for four months following the sale, the greater of five percent of the sale price or $10,000.

b. The funds held in escrow shall be used to reimburse the buyer for damages arising from any renovation, enlargement, repair, or other alteration to the plumbing, electrical, or heating, ventilating, air conditioning, and refrigeration systems of the single-family home by the reseller that was not performed in accordance with the requirements of the State Uniform Construction Code as promulgated by the commissioner pursuant to section 5 of P.L.1975, c.217 (C.52:27D-123).

3. a. A short-term reseller shall complete a property condition disclosure statement, pursuant to section 1 of P.L.1999, c.76 (C.56:8-19.1), to inform a potential buyer of the condition of a single-family home prior to the sale of the home.

b. It shall be deemed an unlawful practice pursuant to P.L.1960, c.139 (C.56:8-1 et seq.) for the short-term reseller to include information on the statement required pursuant to subsection a. of this section that is deceptive, fraudulent, or misrepresentative of the conditions of the single-family home, or that knowingly conceals, suppresses, or omits a material fact in regards to the condition of the home.

4. For purposes of P.L. , c. (C. ) (pending before the Legislature as this bill), any short-term reseller who performs plumbing, electrical, or heating, ventilation and air conditioning services on a single-family home, for which a permit is taken under a certification in lieu of oath pursuant to the State Uniform Construction Code requirements, promulgated by the commissioner pursuant to section 5 of P.L.1975, c.217 (C.52:27D-123), shall attest that the short-term reseller occupied the single-family home as the short-term reseller’s primary residence while the work was being performed. In addition to any other penalties provided by law, if it is determined that the certification in lieu of oath was falsely attested to, the short-term reseller shall be subject to the penalties provided by subsection e. of section 12 of P.L.1978, c.73 (C.45:1-25).

5. The department shall develop and undertake a public education program designed to inform the residents of this State of the provisions of this act.

6. This act shall take effect on the first day of the seventh month next following enactment and shall apply to contracts of sale for a single-family home agreed to on or after the effective date.

STATEMENT

This bill establishes requirements to be followed by short-term resellers, as defined in the bill, to ensure necessary precautions are taken if work is performed on houses intended to be resold within a year of purchase.

After the sale of a single-family home by a short-term reseller to the buyer, the reseller is to be required to retain the greater of five percent of the sale price or $10,000 in escrow, for four months following the sale, which would be used to reimburse the buyer for damages arising from certain alterations not performed in accordance with the requirements of the UCC.

The bill requires a short-term reseller to complete a property condition disclosure statement to inform a potential buyer of the condition of a single-family home prior to the sale of the home, and attest that the short-term reseller occupied the single-family home as the short-term reseller’s primary residence while the work was being performed. This provision is to apply to any short-term reseller who performs plumbing, electrical, heating, ventilation, and air conditioning services on a single-family home, for which a permit is taken under a certification in lieu of oath pursuant to the UCC.

In addition to any other penalties provided by law, if it is determined that the certification in lieu of oath was falsely attested to, the short-term reseller would be subject to the penalties provided by subsection e. of section 12 of P.L.1978, c.73 (C.45:1-25). Additionally, the bill requires the Department of Community Affairs to develop and undertake a public education program designed to inform New Jersey residents of the provisions of the bill.