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.