Homeowners associations, or HOAs, are formal legal entities created to maintain common areas; they have the authority to enforce writing restrictions. Most condo and townhome developments, and many newer single-family subdivisions, have HOAs, which are typically created when the development is built. Covenants, Conditions and Restrictions (CC & Rs) are issued to each owner and HOAs are established to ensure they are adhered to in order to maintain the quality and value of the properties involved.
Characteristics of a homeowners association
- Membership is mandatory for all owners within the development
- Members are generally charged mandatory fees
- Homeowners associations have the authority to promulgate and enforce maintenance and design standards in addition to those established by city ordinances.
- Homeowners associations are corporations with formal charters; there is usually a board of directors that hires a property management company to handle maintenance and enforcement issues
- Many homeowners associations publish a newsletter
According to the Institute of Community Associations:
- An estimated 50 million Americans live in communities governed by associations. About 1.25 million people serve on community association boards, and more than 300,000 others serve as committee members.
- Each year between 6,000 and 8,000 new community associations are formed. This includes condominiums, cooperatives, and planned communities. It is estimated that more than four out of every five homes started during the last 5-8 years have been built as part of a community governed by an association.
- The estimated real estate value of homes in all community associations is approximately $ 2 trillion, approximately 15 percent of the value of all residential real property in the United States.
- Estimated annual operating income for US community associations is $ 30 to $ 35 billion.
In the Phoenix area, each community is slightly different. You will find that it is common for a HOA to handle some or all of the following:
- Establish and collect maintenance fees necessary to run neighborhood operations.
- Maintain community landscaping
- Maintain recreational facilities
- Provide space for neighborhood functions or events.
- Provide security
- Organize street maintenance.
- Enforce deed restrictions, including but not limited to exterior home maintenance, commercial use of property, litter and blight control.
Other restrictions an HOA may impose: street parking, approval of landscaping or plant types, garage door opening, fence restrictions, pool restrictions, mounting basketball hoops or tree houses, boat storage and recreational vehicles, the number of pets, age requirements of residents. There may be more.
If you want to start a discussion on a controversial topic, start talking about Homeowners Associations. You will surely find people who appreciate them, people who despise them, and people who are somewhere in the middle.
Those who like Homeowners Associations say they protect the value of their homes and neighborhoods. They do this by keeping the area attractive, and making sure no one does anything wild, like painting their house gold and pink, parking an 18-wheeler in the front yard, leaving dismantled vehicles on the street, or running a flea market in the driveway. Opponents of HOA point to overzealous and unscrupulous HOA boards, rate hikes that cannot be refused, and rules that are too restrictive, from what kind of bushes to plant, to putting up a clothesline, to avoid flag display American .
Anti-HOA organizations believe that HOAs are private governments that put themselves above the law.
Whether or not to live in a development governed by CC&R and an HOA is an individual choice. Prospective home buyers should:
- Read all CC&R registered in the home and make sure they can comply with the conditions and restrictions contained in the document before the escrow closes.
- Find out what the current fees are. Once you buy the house, you cannot refuse to pay the installments. If you do, you could be evicted and your home could be sold to pay off the debt. HOA dues can range from $ 20 per month to hundreds per month, depending on the property and the amenities provided by the community.
- Find out how often dues have been increased during the history of the HOA. Will you be able to withstand future increases or will you have to move? Find out if the HOA has cash reserves.
- Determine if there are term limits for the Board, and if Board members have attended efficient HOA management training sessions
- Determine if there is a pending litigation involving the HOA
I conducted a survey
For several years, I asked About.com readers what they thought of HOAs. I received thousands of responses. Exactly 50% of the respondents believe that homeowners associations should be eliminated. About 15% of respondents believe HOAs do a good job and about 7% think they are a necessary evil. 13% of the respondents stated that they had been personally harassed by their HOA.
Decide for yourself about HOA
Groups organized to protect the rights of owners and / or opponents of HOA citizens
for constitutional local government
Institute of Community Associations of Pro-HOA Groups
(CAI)
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