Homeowner associations (HOAs) have always gone hand-in-hand with planned communities. The first planned community, Levittown, was established in the mid-20th century in order to provide World War II veterans with the means to acquire homes. Although there was no governing body known as a homeowners association, the deeds to the home included rules governing things like visible laundry lines.
Today, HOAs are still typically established by the original land developers who then turn over authority to the homeowners upon sale of a predetermined amount of units. The purpose of HOAs is to protect property value. As such, they have a wide reach in what they regulate. Read on to learn what it means to live in a community regulated by HOAs.
What do HOAs do?
HOAs are tasked with protecting property value and maintaining communal areas. When you purchase property in planned communities, you will almost always have to join an HOA. Joining an HOA consists of paying a monthly or annual membership fee. You must also agree to abide by the association’s Covenants, Conditions and Restrictions (CC&R), by-laws and other governing documents.
What is a CC&R and what does it cover?
CC&R is a document outlining the community’s rules and regulations which property owners are required to abide. The exact rules in CC&Rs will vary widely across communities, but they can include rules about pets, parking, acceptable paint colors for your exterior, outside antennas, your patio and backyard and so on. Basically, anything relating to your property’s appearance will be open to regulation by the CC&R. This is because your property’s appearance impacts the value of your home. This in turn affects the neighborhood property values which is why HOAs are so determined to regulate what your home looks like. By requiring you maintain a certain status quo, HOAs protect the property values for the entire community. Afterall, if your house is an eyesore, that will lower the perceived value of houses on your street because people prefer living in attractive neighborhoods.
What happens if I don’t follow my HOA’s rules?
Just like the rules in a CC&R will vary by community, so will the punishments levied for violating those rules. An HOA’s recourse for violating CC&Rs typically starts with a written notice and can progress to daily fines. HOAs might even go onto your property and fix the problem and charge you for the service. Say you paint your mailbox an unapproved color. If you don’t fix it in a determined amount of time, your HOA may hire someone to repaint your mailbox and charge you accordingly. In extreme cases, HOAs will file a lawsuit against you asking the court to compel you to resolve the issue. The HOA might also ask for a monetary judgement against you. If awarded, the HOA can often garnish wages and bank accounts. Depending on the state, an HOA might also be granted a judgment in the form of a lien against the property and resulting in foreclosure. Bottom line - don’t be flippant about joining an HOA. It’s a serious and enforceable agreement that you are entering.
Are there benefits to joining an HOA?
In exchange for joining an HOA and agreeing to its CC&R and bylaws, homeowners enjoy many benefits. Most importantly, HOAs are tasked with maintaining communal spaces. With the fees they collect, HOAs manage repairs and even services like landscaping and utilities. Additionally, joining an HOA might provide you access to communal amenities you otherwise could not afford, like a tennis court or pool. If you desire a home in a clean, safe and aesthetically appealing community, HOAs are almost a necessity. While their rules may feel restrictive, remember that their most important concern is protecting property value for the community as a whole.
HOAs often get a bad rap, but they also provide a necessary service to homeowners looking to protect their property value. If you are considering purchasing a home in a planned community, take the time to research the HOA and its rules. For some communities, the HOA is a background presence they barely interact with besides the check they write each month. For other communities, HOAs are a daily presence that dictates how long you can leave your garage door open. Talk to people in the community and do your research. But if you are someone who balks at the idea of someone telling you what color you can paint your front door, then look for a home without an HOA or with less restrictive rules.
Tell us in the comments about your experiences with HOAs!
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