Is there typically an association that will approve or disapprove association fees?
Probably not. But if there is not, what will happen if the tenant refuses to pay the association fees?
will they:
A) just not let them live there, i.e. has to move out.
B) put a lien or otherwise legally put the association fees in debt so that even if the owner is not living there, they will receive them at some point?
C) something else?
and if it is (B), what protection does the condo owner have against exorbitant fees, i.e. selling a property for a seemingly small fee, then jacking up the prices?
FWIW, I live in Florida, but general answers and answers about other parts of the US are appreciated. Thanks!
Well, my association is member run - to be a member you have to be an owner, so it’s in both the owner’s and association’s best interest to keep fees down.
I believe they use standard collection practices to collect unpaid fees (I don’t know for sure, as I pay mine).
As to your second question, when an owner buys a condo they should check the fees - it’s one of the features of the home. If a person buys a $200,000 for $150,000 and fails to notice the $1,000/month fees, then they’re a bit of a doofus.
Also, if everyone’s fees go up 100% (or whatever) I imagine that smart owners would fire their association (assuming it wasn’t owner run).
The own a condo unit in a complex. That complex is governed by an association of directors. When the complex was developed there were by-laws generally governing the directors. The by-laws state that the directors must own a condo in the complex. The directors deal with the operation of the complex including setting fees, maintenance, rules for members of the complex to adhere to.
The directors are elected by all of the owners of the units.
If the directors approve an unpopular “rule” then they run the risk of not being elected next year, plus they personally have to live with the rules themselves.
If someone doesn’t pay their dues I believe the directors can put a lien on the property, which I think is pretty effective in getting people to pay up. I’ve found it to be a fascinating model for learning the operation of governments.
I was on the board for the condo complex I once lived in. The board was made of condo owners and it was simple to join the board. When there was an opening on the board(and there were all the time)any owner expressing interest was usually voted in by the board. This complex had a high rate of owner occupied units.
The fees are set by the board and spelled out in the docs you get during the purchase process. The board has the power to raise or lower fees or have special assessments(to cover the cost of major expenses like re-roofing & such). At my complex, the fee covered the cost of normal upkeep of the properties. It was a set fee, and not based on the cost of the unit. I mean even if property values go up, the cost for maintaining the pool, clubhouse and grounds remains relatively constant. Since the units were similar, everyone paid the same fee.
If you don’t pay your fees, you can have a lien put on your property, which will have to be paid before you can sell. If someone was grossly in arrears, I imagine the board could bring a court action, although I’m not exactly sure. Check your documents for that.
Condo owners pay the fee; tenants are not responsible although a landlord owner can build the fee into the rent.
Board members can be voted out by the association(the rest of the owners), and are legally responsible for their actions as board members.
When I was looking at buying a condo, in a new and wonderful development (man-made lakes and fountains, the whole bit), I was warned of “STRANGE CLAUSES” that I should check out before I signed.
Some of these strange clauses included:
~ All flower boxes have to be white
~ All flowers must be red and/or white
~ All BBQ’s must be black, covered and in the back
~ All draperies must be white/off-white
~ All blinds must be horizontal cherrywood
~ All doormats must be black recycled rubber with no designs
~ All walls apparent to the outside must be white or off white
~ All garbage cans must be dark grey
I’m sure there were more. But that’s enough to put me off aside from the $200 cheque every month. Thanks, but no thanks. I thought I would own the place. And I was corrected, “You own what’s inside the walls, you don’t own the walls.” Hate to think I’m hanging a pic on someone else’s walls.
CheekyMonkey613, I’m not sure if you are misunderstanding the “you own what’s inside the walls” phrase. It means the condo owner owns everything inside the exterior walls. That is, you would own from the studs in and the joists of the roof in. So you DO own the interior walls - even the ones that are the interior of the exterior walls - you just don’t own the exterior part of them.
The roof is common ownership; the walls on the exterior of the building are common ownership. For example, normally if a new roof if needed, the cost is either taken out of the reserve or there’s a special assessment, and each condo owner’s cost is the same. It’s not that the big hole over one guy’s unit causes him to be charged more than another guy with a little hole or no hole, because the roof is not owned by the individual owner: it’s owned by the condominium trust. Hope that makes sense.
That complex you described sounds freakish. Run, do not walk.
Well, I asked and she specified about the walls. But I’m much more comforted in thinking it was a misunderstanding and your version is right. Because that’s ALL that seems right in this situation.
Did you ever read A Wrinkle in Time by Madeleine L’Engle? There’s this bizarre town on another planet that sounds exactly like the complex you describe. I can understand homeowners association rules about not having anyone’s unit be too “out there” but specifying the color of the flowers? The color of your inside walls???
Then again, I know someone who built a house and the town itself - not the HOA - had to approve the proposed landscaping design before they allowed my friends to build. For example, no impatiens. They are too “common” a flower. And the homeowners MUST install landscaping. They can’t decide later on after moving in; a certain amount (enough to look “finished”) must be planted prior to taking residence. Weird.
THe Homeowner’s Ass’n is a weird beast. They can provide a valuable service in making sure your next door neighbor doesn’t paint his house pink and leave a couple rusted out cars in the yard, thereby lowering the value of your own home. That said, I think it gets really easy for the ass’n in a well-regulated development to make up weird rules in order to justify its existence. Of course, as much as we may complain about our ass’ns, we all got the documentation before we moved in, so if we don’t like it it’s our own damn fault.
Note that HAs can not only raise the fees, they can also change the rules. I.e., you wake up one morning and find that they are a 100 new rules you have to comply with. Scary.
Another danger, there have been cases in recent years in my area where some associations failed to pay utility bills (which were suppsed to come from fees). So the utilities cut the condos off. Imagine going all summer with no AC or water.
I’d take the neighbor with a junk car in the lawn any day over these jerks.
Just today we got a notice from our condo board saying our association fees are going up, in part because three units have not been paying their fees and are $12,000 in arrears.
I assume they have liens placed on their property, but if they’re not trying to sell, or refinance, they must be saying “so what”" for now.
I’ve also heard of one couple who wanted to SELL their condo. The prospective buyers had been approved for the mortgage and everything. HOWEVER! The new couple had to be “interviewed” by the condo association. They were refused. To this day, the sellers are sure that it’s because of race. They ended up selling the place to another couple, shortly thereafter.
That would make living there HELL, in my opinion. :mad:
Also, there is usually a Management Company that is hired by the Homeowners Assn. to manage the building, hire staff, enforce rules, etc. But a frequent problem is that the Homeowners Assn. can become ‘controlled’ by that Management Company.
Then you start to see the management company collecting more money each year for it’s work, hiring subsiduary companies to do repair work rather than getting bids, restricting sales of units to their realty subsiduary, refusing to even consider bids from competing management companies, etc.
In one local condo complex, the management company obtains proxy’s from residents who don’t attend the annual meeting. They put a lot of effort into this; employees visit most of the units and ask residents ‘do you plan to attend that lengthy, boring annual meeting, or would you rather just sign this proxy right now?’ I suppose someone else could try to get proxy’s from residents, but I’m not sure how they could do this. Only management approved signs can be posted on the bulletin boards, going down the halls and putting a flyer under each door is strictly prohibited and grounds for eviction, even mailing a flyer to each unit is difficult since they won’t give out a list of residents (for privacy reasons). Last year, the management company came into the annual meeeting with proxy’s from 48% of the residents (and voted them all in favor of re-hiring themselves).
Three friends living in this complex have or are in the process of ‘voting with their feet’–they are selling and moving elsewhere. Unfortunately, they will be taking some financial hits to do this, because:
selling costs will be high, because of the limited number of realtors available.
upon selling, they have to pre-pay all assessments for improvements, which would normally be spread over several years (but they get no reduction for pre-paying these).
because word has gotten out about deferred maintenance and problems with the management company, values of their units have not gone up like similar properties have.
Personally, I’d much rather have a single family house, where the only association rules are those I make myself (or my budget makes for me)!
Well, that’s not universal. Not all condo associations are set up that way. We can freely sell our condo, and I can tell you that we have a lovely variety of neighbors. Black, white, mixed-race couples, couples “living in sin,” gays, etc.
You’ve forgot about the red tape one layer up - the city. If it is like a typical US city, they’ll have a zillion building codes, some of which make sense, a lot of which don’t. If the city happens to be a wealthy old suburb, there will be two zillion building codes.
One silly example: most cities have restrictions on where an air conditioning compressor can be placed. Things like “it must be 15 feet from any neighboring property”, “it can’t be in front of the house”, etc. Makes sense, other people don’t want to hear or see your noisy compressor, right? But what if you’ve got a small lot? I’ve seen places where the only legal place to stick a compressor was directly outside the back patio door, even though there are other spots that would work much better for you and wouldn’t harm your neighbors (for instance a space between your garage and the neighbor’s garage, or a spot in the front hidden by shrubs/bricks/etc).
As much as my condo association drives me nuts, I know that I have it pretty good. I can’t imagine the horror stories that I’ve heard above. We are self managed, have a well run, active board, have more than 100% reserves in the kitty, and apart from a few busybodies, a lot of great neighbors.
OK, so I live in California where board members can be held personally liable for the decisions they make. This may also be true where you live.
There may be legal cause for action in the above posts where prospective buyers where turned away by the board, and the other example where the board failed to pay the utility bills.
As a member of the association-an owner of a unit-you may/should have legal recompense for actions of a negligent board.
When I was on our board, we cut some operating expenses by installing fluorescent outdoor lighting, and by hiring a cheaper gardener. With the money, we created a fund for longer-term maintenance such as parking lot repaving and exterior painting. There are competent boards, and most the association members didn’t have to worry about the ‘nuts & bolts’ of budgeting and maintenance as single-family dwelling owners do.
BTW, I now live close to a ‘planned community’ of single-family homes. They have an HOA with CCRs. So you can find this type of governance in many places, not just condos.