Four Things to Know about Condo and Homeowner Associations

Published on September 1, 2022 by Planet Home Lending

Did you know that some communities prohibit fences? Or that they might require you paint your house a color from among a preapproved list of hues?

It’s true. If you purchase a condo or a single-family home that has a homeowners' association, you’re agreeing to be bound by the rules and regulations of that planned community.

The condo or HOA board of directors, which consists of owners within the community and is elected by the community, typically enforces rules and regulations.

How do you know what the rules are before you buy a home? You’ll find them in documents called covenants, conditions, and restrictions, or CC&Rs. Your real estate agent can get a copy of the CC&Rs from the homesellers.

Your approval of the CC&Rs can be one of the contingencies you put into any offer to buy a home. That way, you must be given CC&Rs and will have time to look them over. You’ll also be able to back out of your offer if there’s something in the rules that would cause you not to want to buy the home after all.

You may be in the group of people who have no problem following the rules in a community. Or, they may make you grind your teeth while muttering, “You’re not the boss of me!”

How can you know which camp you’ll fall in? Here are four areas that can disenchantment among condo/HOA owners:

1. The risk of assessments.

Associations usually collect monthly or annual fees to cover common area maintenance and repairs. The community also usually puts money in reserves to fund big repairs.

The clubhouse, the swimming pool, the walking trail, the parking lot — all are maintained by the community, and that costs money. In condos, the list of items maintained also typically includes big-ticket items like roofs, windows, and siding.

Not all communities, however, are good at funding reserves or even creating and following an annual budget. Then, when work absolutely, positively must be completed (imagine the roof of the clubhouse is like Swiss cheese), the board must turn to owners for the funds, typically imposing a special assessment. That means you can get a big, whopping bill.

Yes, in most communities, owners get to vote on whether a special assessment will be imposed. But you could be in the minority of owners who opposed an assessment, but who still have to pay it. And it’s not unheard of for special assessments to run in the thousands of dollars. Ouch!

2.Getting approval for changes to your home.

Typically, a condo or HOA has an architectural review committee to field requests from homeowners to change their property in a substantial way.

You want a fence to keep your dogs safe? You’ll have to get its look and size approved — and that’s if fencing is even permitted in your community.

You want to build an addition? You may be able to, as long as it fits the style of the community, doesn’t exceed certain size restrictions, doesn’t block your neighbors’ views, and so on.

Even interior changes can be subject to CC&Rs. You want to add hardwood flooring in your condo? You may need approval to ensure it’s not a material that will create unacceptable noise levels for the neighbors below you. You want to knock out a wall in your condo to create an open-plan kitchen and dining area? That may have to be approved, too, so that it’s clear you’re not going to remove a load-bearing wall that impairs the building’s structure.

To get approval for all of these changes, you typically have to submit a written request, provide builders’ drawings, show you’ve gotten permits, and more. Some owners find that too burdensome.

3. Keeping track of and following the rules.

There are big rules in condos and HOAs, like getting approval for architectural modifications to your home, and then there are small ones. And there are typically lots of small ones, including rules you’ll never realize are there until you break them.

A typical rule in an HOA? You can’t put your trash cans out before 6 the night before scheduled refuse pickup, and you must put them back in your yard by 6 p.m. on the day of pickup. Or, all pets must be registered with the community association, and you must provide evidence of all vaccinations required by your local governmental agency.

Whatever, you’re thinking, I just won’t follow the rules I disagree with. That could cost you. Literally.

Some condos and HOAs have provisions in the CC&Rs that allow the board to fine rulebreakers. The fines can add up, and your community could even take you to court to force you to comply, in which case you could be hit with the legal costs spent to make you fall in line.

4. The rogue leadership team.

The vast majority of condos and HOAs are run by volunteer board members who are smart, helpful, talented, and well-intentioned. There are some, however, run by people who shouldn’t be in any leadership position.

They’re dictatorial, perhaps bullying, or maybe they’re inattentive, unresponsive and lazy. Those leaders can make the lives of their fellow homeowners miserable.

For best results, you should participate, and that’s not always easy or fun.

Point #4 leads us to a final point: The best-run communities are those at which many homeowners give their time to serve on the board or committees or volunteer to help with community events or activities. The more people who are involved, the more ideas will be shared, and the best chosen among them.

The best-run communities are just that — communities. An important element of community building is people who are willing to come together and work to make all neighbors feel heard and welcome. That takes time and commitment. Are you willing to do your part to make your community a success?

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