MAR Online Blog

The two-year legislative session came to a close with a flurry of late-night activity. Here are some highlights:

Housing Bond Bill (Affordable Homes Act, H.4977)

This bill, which is updated every five years, aims to increase housing funding and improve policies. It allows over $5 billion in bonds, nearly three times more than the previous bill in 2020. Key outcomes include:

• MAR successfully blocked a much-discussed transfer tax proposal.
• Rent control, tenant’s right of first refusal (TOPA), and broker fee shifting were also successfully blocked.
• Several MAR-supported items made it into the final bill including:
• Accessory dwelling units allowed in single-family zones.
• Increased infill housing by removing the presumption of adjacent lot joinder.
• Enhanced protections against baseless anti-development abutter appeals.
• New tax credits for converting commercial buildings to residential.

The bill is now with the Governor, who has ten days to either sign it into law or veto it. We are advising the Administration to veto language mandating home inspection contingencies in real estate contracts.

FY2025 Budget

This near-final budget includes two major real estate policy wins:

1.  Expansion of Title 5 Tax Credits:

• Previously, tax credits were only for system failure repairs or replacements. Now, homeowners can get 60% of expenses (up to $30,000) for repairs, replacements, or upgrades of septic systems or sewer connections required by Title 5 or a watershed permit.
• This will help more homeowners, especially those impacted by the new Nitrogen Sensitive Area regulations on the Cape.

2. Overhaul of Home Equity Theft Law:

• Massachusetts was one of a dozen states with a law that allowed municipalities to seize homes for unpaid debts and keep all the equity. This practice is now ruled unconstitutional by the US Supreme Court.
• Over the past year, MAR filed amicus briefs in two state court cases and advocated for a legislative fix. The budget includes these significant fixes:

o   Municipalities or debt purchasers must list homes with a real estate licensee to maximize homeowner equity.

o   Improved homeowner notices.

o   Cities can forgive up to 100% of interest.

o   Interest on unpaid municipal debts reduced from 16% to 8%.

o   Homeowners have 10 years (up from 5) to repay debts.

o   Down payment for repayment agreements reduced from 25% to 10%.

o   Unclaimed equity will go to the unclaimed property fund.

Historic Tax Relief (H.4104)

This is the first tax relief law in Massachusetts in two decades and has significant impacts on real estate:

• Senior Circuit Breaker Tax Credit: Doubled.
• Rental Deduction Cap: Increased from $3,000 to $4,000.
• Good Landlord Tax Credit: Allows up to 100% local property tax relief for affordable housing.
• Lead Paint and Septic System Tax Credits: Doubled.
• Housing Development Incentive Program (HDIP): Funded with $57 million to create market rate housing in gateway cities and tripled the annual cap.
• Estate Tax Threshold: Raised by $1 million.
• Short-term Capital Gains Rates: Decreased by 30%.

FY2024 Budget

The first budget in this session included $50,000 to help homeowners test for crumbling concrete foundations and a new licensing requirement for quarries which must now test for the mineral that causes this issue. This will protect future homeowners from this devastating problem.