Home, sweet home: a sampling of the latest trends facing homeowner association managers
New legislation, litigation and luxury options are redefining the realm of the homeowner association (HOA). Here's a look at trends affecting condominium markets and the HOAs that care for them.
A Mad, Mad World of Restrictions
Read any local newspaper and you may decide condominium ownership is only for the strong of heart:
* "The $140,000 Parking Ticket in a California Homeowner Association," AHRC News Services, Palm Desert, Calif., March 2005
* "A disabled Magalia (Calif.) man is going to court in a fight to keep from losing his home after he missed a $123 payment to the Paradise Pines Property Owners Association." Chico Enterprise Record, March 2005
* "Homeowner Associations Face New Limits," Sacramento Business Journal, May 2004
The golden laws of condominium ownership relate to what the industry terms "C, C & R"--covenants, conditions and restrictions. Written by the developer (assisted by an array of legal and other consultants) for entitlement purposes, these terms establish rules and standards for the project. A lesser, but important, set of rules defines environmental and architectural standards for the development, such as exterior paint colors and landscaping requirements. The de facto approval of bylaws by a homeowner accompanies each condominium purchase.
HOAs define their mission as sustaining property value by managing, maintaining and preserving the development for the common benefit of all the owners. Homeowners should expect a dispute if collective good collides with individual want. The California Supreme Court ruled anyone who buys "a unit in a common interest development with knowledge of its owner association's discretionary power accepts the risk that the power may be used in a way that benefits the community but harms the individual." In other words, owners may need to weigh their desire to install solar panels against a daily set of tennis on the association's rooftop courts.
How far should a HOA go to preserve value? Let's assume an association's environmental rules specify a homeowner must maintain his or her front yard landscaping. Can an association require a thirsty species of grass? Couldn't the homeowner contract with a landscape architect to design an attractive xeriscape, with minimal water requirements--especially for drought areas where municipalities ration water?
Colorado State Senator Bob Hagedorn (D-29th Dist.) encountered a series of vocal constituents on last year's campaign trail, many of whom found their HOA rules oppressive. Hagedorn said, "Most HOA boards are doing it right. But there are a significant number of HOA boards that are running roughshod over rights of homeowners. What we are trying to do is find the right balance of protecting homeowner rights and the responsibilities of HOAs." To that end, Hagedorn and Colo. Representative Morgan Carroll (D-36th Dist.) introduced state Senate Bill 100, now awaiting House approval. The passage of S.B. 100 would prohibit Colorado HOAs from fining homeowners for the presence of political yard signs or the American flag, limiting xeriscaping or fining street-side commercial vehicle parkers if they are emergency first responders who need access to their vehicles.
Hagedorn said: "I have been most intrigued...
This is a preview. Get the full text through your school or public library.