I am confused about home owners associations - there must be some limit to what they can do.
If one buys a residence which is part of a home owners association what it seems one is signing a contract with unknown persons with unlimited rights.
There must be thousands of these associations with millions of members but I cannot find where the limitations are spelled out.
How does one know that 51% of the association cannot raise the fees by 200% or 2000% and plant roses in the parking strip or require $75,000 conversions to solar energy or who knows what?
When you buy the house, you get a copy of the homeowners association document (sometimes called a CC&R, meaning Covenants, Conditions and Restrictions but I think it can have other names). It spells everything out for you, about what the rules are you’re agreeing to, how those rules are decided on and enforced, how board members are elected, etc.
It’s hardly “unknown persons” and “unlimited rights” - the document we had to sign for our old place was immense and extremely detailed, and included contact info for the board.
You should inquire if the property your interested in, is subject to an HOA. If it is, you should request a copy of the HOA agreement and review prior to making an offer on the house.
If you sign a contract with a homeowner’s association that does not prohibit them from doing crazy stuff like that, then they can. It is certainly not illegal. On the other hand, it would be pretty hard to get 51% of the homeowners on board with stuff like that.
You need to have a lawyer look over the HOA agreement in order to tell you what is and isn’t possible for them to do.
The HOA board serves at the pleasure of the membership (homeowners). The rules in the covenants and by-laws are voted on by the membership and can be repealed by the membership. The board cannot arbitrarily make up rules and impose their will on homeowners, although sometimes board members think they can get away with it. Payback for over-zealousness usually comes at the annual meeting, when elections take place. Members are free to voice their opinions of incumbent board members and state why they should be replaced, nominate new members, etc. Quite often, there is no limit to the number of people who can serve on a board at any one time. The HOA board can no more take unilateral action than can any of the membership, and are subject to legal action if they try to do so.
There is no cite for the above. All HOAs have their own rules and by-laws, but the above is generally the case.
The are some things the board can change on their own, but what those powers are are spelled out in the CC&Rs. For example, most boards can raise monthly dues annually up to a given percentage increase without an HOA-wide vote. That said, many board members are reluctant to do so for fear of losing their seats.
As pointed out, the HOA cannot override the laws of the state they are in, and some states have many laws relating to HOAs. In my state, for example, there is a maximum percentage by which HOA fees can increase each year, so no, 51% of the association cannot raise the fees by 200% or 2000% unless there is a real emergency.
If you’re concerned about fee hikes, look at the budget. It’s a very detailed financial document and a careful reading can tell you everything you want to know about a given HOA. If dues haven’t been raise for two years or more, you’re overdue for one. If something big like roofs or insurance isn’t properly funded, you could be in for a special assessment (a horrible thing I wouldn’t wish on my worst enemies).
Just remember, you may not agree, but the money collected is spent on things members benefit from.
Just out of curiosity - never having lived in a place with an HOA before - is it possible to “opt out” of membership?
That is to say, if I bought 1313 Mockingbird Lane, which had previously been part of an HOA, and I decided I wanted no part of it (as I wanted to redecorate in Early American Gothic Revival rather than Midcentury Modern), could I just say “See Ya, Suckers!” and un-join?
Or if I just ignored them, didn’t pay HOA dues, and redecorated anyway - what could they do to me?
all of these scenarios depend on the laws of the state. It varies tremendously.
Just remember, an HOA is a contract between two private parties. You are voluntarily signing this contract. If you don’t like the terms, don’t sign (buy). That said, you are obligated under this contract just like any other contract.
The courts are almost always friendly to HOAs and will side with them in most any dispute. Failure to pay dues and comply with the rules can, in the worst case, cost you your house or result in a lien being placed against your assets. Refusal to agree (sign) to the by-laws, etc., will usually result in you being unable to purchase the home. An HOA can take you to civil court and force you to remove any unapproved improvements. Sounds draconian, but the rules protect ALL the property owners from a few knuckleheads.
We had an excellent HOA right up until just before we left, when a little dictator got into the chairman’s spot. She got her ass handed to her pretty quickly. They took one person to court while I was there because he refused to pay the portion of the dues that went to cable TV. Problem is, the majority of the membership agreed to the dues hike, so he was SOL.
Right… But if I’m buying the house, it’s impossible to buy without also joining the HOA? As someone said before, it’s an agreement - but it’s an agreement between the previous owner and the HOA, it’s not got anything to do with me.
Several HOAs in my area allocate a majority of the seats on the board to the developer until every last lot is sold. The crappy housing market means that none of them are actually controlled by the homeowners (they’re controlled by the single owner of the handful of empty lots), and they won’t be for the foreseeable future.
Usually if there’s an HOA then you have to join. Though I lived in one place that had an HOA that you didn’t have to join, but then you had to get your own trash service and you couldn’t do some of the other things like join the pool.
Unfortunately, around here almost every place has an HOA so it’s really hard to not be in one. The one I am in says no trucks can be parked over night.
It’s really not that different from moving into a small town with home rule. Theoretically the city council could force you to do any number of silly things. Realistically, they won’t. And certain things they might theoretically do are not permitted by state statute.