Iowa Real Estate Law Changes 2023

This article highlights and discusses updates to Iowa’s Real Estate Laws in 2023, including Mechanic’s Liens, Mobile Home, or Manufactured Home Landlord/Tenant Laws. We have seen some changes to Construction Law.  

What Changes Have Gone into Place for Mechanic’s Liens?

As of January 1st, 2022, a few amendments to mechanic’s lien laws became effective.  

A mechanic’s lien is a legal claim against a home or property. Typically, these types of liens are used by subcontractors and suppliers to seek payments they have not received for improvements made to a home or property.  

The law previously required a claimant to post a mechanic’s lien to the Lien Registry for each separate county if a parcel of land spread across multiple counties. Now, claimants are only required to file one lien to cover all counties in which the parcel is located. Additionally, the new law allows the prevailing party who filed the mechanic’s lien to recover attorney’s fees if the lien is “bonded-off” or removed from the property with the promise of payment by a surety bond. HF561.  

For more on mechanic’s liens read our article about Changes to Iowa Mechanic’s Liens  

What are the Laws Regarding Mobile or Manufactured Homes?

To provide residents of mobile homes or manufactured home communities with more protection, the Iowa legislature has passed new laws, which include:

• stating the legal remedies for tenants if a landlord or community owner is not providing running water or other essential services  
• providing tenants with 12 months, instead of 6 months, of legal protection from retaliation  
• changing the definition of “rent” to include base rent, utilities, and late fees  
• increasing the time for notice of an increase in the rent or utilities to 90 days  

• outlining the terms that must be included in a rental agreement and what types of provisions are prohibited  
• lengthening the time for notice to a tenant of the intention to not renew a lease to 90 days  
• requiring landlords to furnish a general reason for refusing a purchaser when a tenant is attempting to sell their mobile or manufactured home  
• limiting landlords from forcing tenants to modify their mobile or manufactured homes in a way that would make it hard for the tenant to move the home  
• outlining terms that must be included in the sale of a mobile home or sale of the park or community by a landlord and the successor’s interests  

• modifying nonconforming use law exceptions  
• clarifying the time for service of a notice to evict  
• broadening the cause of action for abandonment of mobile or manufactured homes  

As of May 17th, 2022, the portions of the law that amend the rent increase notice and the failure to supply essential services went into effect. All other portions of the law discussed in this section regarding mobile home landlord and tenant laws are to become effective on July 1st, 2022.  

Failure to Provide Essential Services (became effective May 17th, 2022)  

Suppose a landlord fails to supply running water or other essential services. In that case, the tenant may give written notice to the landlord that specifies the breach of the landlord’s duty. The tenant may purchase reasonable amounts of water or another essential service when the landlord is not providing them, then subtract the cost from the rent. A tenant may also collect damages or recover rent that was paid during the time the landlord failed to provide water or another essential service. It is important to remember, though, that these options are not available until the tenant has given notice to the landlord or a tenant can recover if the condition was caused intentionally or negligently by the landlord toward the tenant, a member of the tenant’s family, or any person on the premises with the consent of the tenant. 562B.23A.

Can a Landlord Retaliate?

A landlord should not retaliate against a tenant after  

• a tenant made a good faith complaint to a governmental agency for a violation of the law which affects health and safety,  
• the tenant made a complaint to the landlord about a violation,  
• the tenant becomes a member of a union, or  
• Exercising the tenant’s rights.  

If a landlord is found to have retaliated against a tenant, the tenant is entitled to remedies and has a defense in action for possession. A landlord’s alleged retaliatory acts are presumed to be retaliation if the acts occur within one year of a complaint being made. The new legislation lengthens the time frame for this presumption from 6 months to one year. The presumption will not apply to a complaint made after the landlord gives a notice of termination of the rental agreement to the tenant. HF2562.  

What are Rental Agreements?

The new law defines rent as payments to be made to the landlord under the rental agreement, including base rent, utilities, late fees, and other payments made by the tenant to the landlord under the rental agreement. Instead of the previous 60-day requirement, the new law requires landlords to give mobile home tenants at least 90 days’ notice if they do not intend to renew the lease. Additionally, effective May 17th, 2022, landlords are required to give tenants notice in writing of any rent increase at least 90 days before the increase is to occur. HF2562.  

Disclosure of Utility Charges

The landlord, or an agent of the landlord, entering a rental agreement with a prospective tenant must provide a written explanation of utility rates, charges, and services to the prospective tenant unless utilities are to be paid by the tenant directly to the utility company. The new regulations add another protection for tenants by requiring they be notified of any increase in utility rates or charges at least 90 days before the increase. However, if a landlord does not receive notice from the provider at least 90 days prior to the increase, no prior notice to the tenant is required for the increase to be effective. The legislature notes that these laws do not allow landlords to meter premises contrary to applicable law. HF2562.  

Prohibited Rental Agreement Provisions

The law already provided that rental agreements should not force either the landlord or the tenant to  

• agree to waive or forego their rights or remedies,  
• agree to pay the other party’s attorney’s fees,  
• agree to get rid of or limit any legal liability of the other party or to indemnify the other party for that liability or the associated cost, or  

• Agree to a designated agent selling the tenant’s mobile home.  

In addition, the new law will prohibit agreements to modify the mobile or manufactured home in a way that would “significantly impair” the tenant’s ability to move the home. However, this type of provision would be allowed if the modification is required by the manufacturer’s installation instructions, a finance agreement made by the landlord for the home or community in which the home is located, or mandated by federal, state, or local law. Finally, the landlord and tenant may agree to a modification in the rental agreement if necessary for the “safe and proper installation of the home.” HF2562.  

Can a Landlord Deny a Rental or Refusal of Sale?

Residents of a manufactured home community or mobile home park have a right to sell their mobile homes at their chosen price. Landlords cannot deny their residents the right to sell. However, landlords can reserve the right to approve the purchaser of a resident’s mobile home. The updated regulations add that if the landlord disapproves of the purchaser, then the landlord needs to provide the purchaser with written notice and a general reason for the denial. HF2562.  

If you are interested in more information on buying a home in Iowa read our article, Buying a Home on Contract in Iowa.  

Landlord Sales

The legislature has added a new section to the law that states any sale to a prospective tenant by a landlord of a mobile home located in a park or community shall be in writing and include basic terms of the sale like  

• the total cost of the home and  

• if purchased under an installment contract –  
• finance charges,  
• annual percentage rate, and  
• frequency and amount of each installment payment.  

Upon full payment of the purchase price and satisfaction of the terms of the agreement, the landlord needs to assign and give the certificate of title to the purchaser. If the sale does not comply with the law outlined above, the court can award money or void the sale. Also, the buyer may recover monetary damages that were incurred, security deposit amounts above two months’ rent, and reasonable attorney fees. HF2562.  

Further, another new section addition specifies what interests the previous landlord and their successor has after the sale of a manufactured home community or mobile home park. Once the landlord sells their interest in the community or park, the purchaser shall have the same legal obligations, rights, and remedies as the prior landlord had. HF2562.  

Nonconforming Uses

Under Iowa law, when a preexisting mobile or manufactured home is replaced by any other similarly situated home, enforcement of any regulations or imposing any conditions on the replacement home or the plot of land where the new home sits that were not previously enforced or imposed on the prior home or lot is prohibited. This section makes some minor modifications to the exceptions to that rule.  

This rule does not apply if  

• Replacing the old home with the new home would substantially increase the risk to the safety of life or property  
• the property owner has abandoned the nonconforming use for one year unless the abandonment is caused by circumstances outside the owner’s control like  
• floods  
• fires  
• destructive thunderstorm events (Derechos and tornados)  

• similar catastrophic events causing severe property damage  

*Note: a property owner is not considered to have abandoned the nonconforming use if the owner can demonstrate that the home’s location continues to be available for a replacement home. *  

• the replacement home’s character is substantially or entirely different from the original lawful preexisting home’s nonconforming use  
• the replacement home obstructs a shared driveway or shared sidewalk, limiting the ability of vehicles or pedestrians to access it  

HF2562.  

Forcible Entry and Detainer

Evictions in Iowa are called “forcible entry and detainer.” Iowa law requires that an action for forcible entry and detainer be brought in the county where the property is located. Further, the initial hearing for eviction must be held within eight days of the filing date of the petition unless the petitioner requests or consents to a later date, but it cannot be held any later than 15 days after the petition is filed. HF2562.  

The new law details how days are counted for service of the original notice. Service is presumed to be completed four days after the notice is deposited in the mail and postmarked for delivery. The law states that the first day the notice is mailed is not included in the four-day requirement, but the fourth day is included. Chapter 648.5, Forcible Entry and Detainer. HF2562.  

For more on Landlord/Tenant information, please visit: https://www.oflaherty-law.com/learn-about-law/iowa-landlord-tenant-law-changes or https://www.oflaherty-law.com/learn-about-law/iowa-landlord-obligations-and-iowa-landlord-tenant-laws-explained    

What Happens to Abandoned Mobile Homes?

An action alleging abandonment of a mobile or manufactured home must be brought to the court where the property is located. The new laws broaden the cause of action for abandonment of manufactured homes by adding situations where there is a lien on the property. The law expresses that when a tenant, who was the sole owner of the home, dies during the rental agreement, an abandonment action can be brought against a deceased tenant’s estate and their heirs. HF2562.  

What are Changes to Construction Laws? (Bill not signed by the governor yet)  

Lastly, there may be a couple of changes to construction laws if the Governor of Iowa signs it. By Iowa statute, construction contracts that involve public money must use design-build contracts. If a property owner hires an architect to design a building and separately hires another party to build the building physically, this is called a design-build contract. The new law would disallow public universities from using these types of contracts. Further, the new law would prohibit governmental entities from using fee-based selection to hire architects. Senate Bill SF 183.  

If you are looking for any updates read our article, Iowa Foreclosure Laws in 2022

If you have questions about your rights regarding a mechanic’s lien on your property, your rights as an owner of a mobile home, or any other questions regarding the topics discussed in this article, please reach out to an O’Flaherty Law Attorney. To request a consultation with an Iowa Real Estate Lawyer, call our office at (630) 324-6666, or you can also fill out our confidential contact form, and we will get back to you shortly.

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