How to Navigate Maryland’s Tenant Right of First Refusal
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Maryland’s new Tenant Right of First Refusal (ROFR) gives eligible tenants the first opportunity to purchase a rental property before it’s sold to someone else. This change means landlords, tenants, and real estate professionals need to understand the notices, timelines, and legal requirements. With the right preparation, these transactions can go smoothly for everyone involved.
What Is Maryland’s ROFR?
ROFR under Maryland’s 2024 Renters’ Rights and Stabilization Act (HB 693) requires owners of residential rental properties with 1-3 units to offer certain tenants the chance to buy in two scenarios:
Exclusive Negotiation Period: Before listing the property or accepting outside offers, the landlord must formally offer the property to the tenant at the market price, giving the tenant 30 days to accept, decline, or counteroffer. If the tenant accepts at the offered price, that price holds—even if a higher offer later appears.
Third-Party Offer ROFR: If a landlord receives an acceptable third-party offer, they must notify the tenant and allow the tenant 30 days to match it.
All notices must be submitted and recorded via the Maryland Department of Housing and Community Development’s (DHCD) portal or through the Office of Tenant and Landlord Affairs (OTLA). Legal documentation must be kept to show compliance.
Which Tenants Are Eligible for ROFR
A tenant must meet specific criteria to be eligible for the Right of First Refusal. In most cases, ROFR applies when all of the following are true:
The tenant is named on the lease for the property.
The tenant has lived in the property for at least six months before the notice is issued.
The tenant is currently residing in the unit and has not vacated voluntarily.
The tenant has not been legally evicted — meaning a final court order for eviction has not been issued.
Additional points to note:
Month-to-month tenants do qualify as long as they meet the six-month residency requirement.
Tenants currently involved in eviction proceedings still maintain their ROFR rights until a court officially orders eviction.
When ROFR Does Not Apply (Exemptions)
There are certain scenarios where the Right of First Refusal is not triggered. If any of the following apply, the property is typically exempt from ROFR requirements:
The sale is to an immediate family member or to a business entity wholly owned by the landlord.
The property is sold as part of an estate transfer, foreclosure, tax sale, or eminent domain.
The property is part of a larger building with four or more units, unless the sale is for an individual condominium unit.
Roommates or occupants not listed on the lease do not qualify for ROFR rights.
Tenants who have already vacated the property voluntarily before notice is given are not eligible.
Timeline & Practical Steps
To make sure the ROFR process proceeds smoothly, pay attention to the legal deadlines and required steps:
| Step | Who’s Responsible | What Happens | Timeframe |
|---|---|---|---|
| Step 1 | Landlord | Issue the ROFR or Exclusive Negotiation Period notice through the DHCD/OTLA portal before listing or accepting offers. | Before property is listed or sold |
| Step 2 | Tenant | Respond to the notice by accepting, declining, or submitting a counteroffer. | Within 30 days |
| Step 3 | Landlord | Review and respond to any counteroffer made by the tenant. | Within 5 days |
| Step 4 | Tenant | Make a final decision after the landlord’s response—either finalize or reject the counteroffer. | Within 5 days of landlord’s response |
| Step 5 | Landlord | If a third-party offer is accepted, notify the tenant and provide the opportunity to match the offer. | Tenant has 30 days to match |
| Step 6 | Landlord | If the third-party offer is more than 10% lower than the tenant’s earlier counteroffer, re-offer the property to the tenant at the new price. | Upon price change |
Best Practices for All Parties
Here are steps tenants, landlords, and realtors can take to stay on the right side of ROFR:
Document everything: keep copies of notices, communications, and portal records.
Verify eligibility early: check leases, occupancy, eviction status before listing.
Price fairly: realistic market values prevent disputes. If the tenant accepts the offered price, it’s binding.
Use the portal properly: some mistakes (wrong address entry, missing data) can delay compliance.
Understand lease continuity: tenants keep existing lease rights during negotiations; new buyers may inherit tenants.
Why This Matters for Title & Closing
ROFR laws add requirements that affect the sale transaction:
Title and closing documents should reflect whether the ROFR was triggered or waived.
If a tenant accepts the ROFR, the title transfer must match that agreement. Along the way, title searches should include verifying no liens or encumbrances against the year in question.
Mis-steps (wrong notices, failure to include tenant rights, incorrect price) can invalidate parts of a sale or cause legal liability.
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Bottom Line
Maryland’s Tenant Right of First Refusal creates important steps for landlords, tenants, and real estate professionals to follow. When the rules are followed, ROFR can provide tenants a real opportunity while allowing property transfers to proceed smoothly.
Preparation is key: identify eligible tenants, use proper forms and notices, stick to the timelines, and verify title early. With those in place, ROFR is not a hurdle—it’s a structure that supports fairness and clarity in property sales.
