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Homeowner Associations/Condo Associations
Old 09-08-2006, 12:57 PM   #1
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Homeowner Associations/Condo Associations

I thought it would be interesting to open a dialogue on participants' experience with homeowner associations/condo associations.

DW and I moved into our new home a year and a half ago. This is the first time we have lived in a community with a homeowners association. It has been an eye-opening experience. The situation we face is like the American colonists - taxation without representation. Until the building of the community is complete (two more years?) the developer has full control of the Board of Directors of the association. The board members are all employees of the developer except for one homeowner the board appointed (she is believed to be a paid ally of the developer). This gives the developer complete control of the association budget and all significant decisions about its operation. However, our monthly dues of $210 are used to pay for all costs of the association. The board has used association funds for expenses that by law or county regulation are clearly the responsibility of the developer. The board simply ignores any protests we have made. Once the association transitions to homeowner control we will probably need to sue the developer to recover such funds. In the meantime, the level of mistrust between the homeowners and the association board and developer continues to escalate.

In essence we have a small town goverment that is completely unresponsive to the taxpayers. The board's latest dictatorial act was to disable the residents' discussion forum on the association web site after numerous postings about the improper actions taken by the board. Seems the first amendment doesn't apply here.

Don't get me wrong, I love living here. Our house and neighbors are great and the community amenities are first rate. But the total inability to have any influence on the governance of the community is extremely frustrating.

What has been your experience with HOA/condo associations?

Grumpy
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 01:36 PM   #2
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Re: Homeowner Associations/Condo Associations

My thoughts (we are in one)..

You should check with your state or county about the authority of a developer to pass assessments prior to turning over the assn. In our area when development is 50% sold the developer must turn over the assn to the owners.

It is my observation that developers want to keep the dues low during the sales period because it helps them sell properties - they often effectively pick up maintance costs for that reason (after all their landscape folks are already on site).

Cliques are an on-going issue with homeowner assns - some times the loudest mouth takes control because no one wants to stand up to him/her. Were I you I would start scouting out reasonable folks who are able and WILLING to take the thankless task of assn leadership. Review the current bylaws to see what you think should be changed (often they are crib'ed from earlier development and have little application to your group). Start researching board member liability insurance.

Often homeowners just want an assessment that covers current expenses. I think it is wise to have a little extra for reserves, particularly if there is an assn pool or community center.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 01:54 PM   #3
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Re: Homeowner Associations/Condo Associations

I am in two HOAs currently. One for our subdivision and one for the cabin. They both have a lot in common.

The person who wants the power is given it. Most people either don't want the job or don't have the time for it. That leaves the power-hungry folks to fill in the top positions. The rest follow like sheep or don't care enough to even attend one annual member meeting.

The board has to deal with a lot of whining and bad mouthing and most people don't want to deal with this in their "off hours." That leaves just a few vocal members to keep tabs on the board. Some are very good at it and some are just a pain in the rear.

There is never enough money to do what everyone wants to be done. Yet, no one wants to increase the fees. Publish a meeting agenda where you will discuss increasing fees and you better get a bigger room.

By laws are not equally enforced if at all. The guy on the other block with the hot pink front door still has it despite complaints and it being against the rules. Folks that don't pay their dues may get off for years until they sell and the new owner is stuck with the bill.

Maintenance items get overlooked and the cost of things outpaces the budget so even more stuff gets left undone or underdone.

My house HOA dues are higher than my cabin HOA dues yet there is far less to be paid to be done in the home HOA; only lawncare and lighting at the entrance and insurance for the board as well as a few other minor things. The cabin has 20 miles of roads to snow plow and maintain for over 500 cabins plus maintenance of the private water system, public areas, and overall fire protection of the area. The homeowners keep voting down an increase in fees and the board does not go after those that don't pay their dues.

Some might work better but none I have been in seem to much better.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 02:07 PM   #4
 
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Re: Homeowner Associations/Condo Associations

I am the President of our HOA in our very small assoc (7 twin Homes - 14 Units). Our development sold quickly, so our board took over quickly.

SteveR was right, nobody wants my job. The first board were 'Yes' men that said 'Yes' to everything. And there were a few peole that moved in that thought they were in a 'resort' and any wish/problem that they had would be fulfilled. They spent all of our money on a few people. This is do different than any other management position I've held: 10% of the people are responsible for 90% of the problems.

The first thing that we did was make up a clear definition of who was responsible for what - Money wise - Whether it was the Homeowner or the Assoc. Funds. - We also are always up to date to assessments. We start foreclosure procedure after 60 days or payments in arrears. We also strictly enforce all rules and levy fines for non-compliance.

We run a very tight ship here! - And things are very organized after 8 years.

BTW -- We also have $100K in the bank that I am investing in CD ladders. - This will be used for Roofs and exterior remodel 10-15 years down the road. We collect $300 a month and our Bills usually run $150, so we are saving 50%.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 02:18 PM   #5
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Re: Homeowner Associations/Condo Associations

We've owned a home in fla. for about 3 1/2 years and haven't had much dealings with the HOA since we still live in NY.* Everytime we go down to the house all the homes are perfectly kept and the HOA seems to stay on top of the slackers.* We are moving down in Nov. and happy so far with the HOA.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 02:28 PM   #6
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Re: Homeowner Associations/Condo Associations

About the only thing worse than a power mad HOA is owning property in a subdivision without a HOA.

Like the example Brat quoted, our subdivison developer abandoned turned over HOA responsibilites to the lot owners once 60% of the lots were sold. At least the developer never collected HOA dues even though we were clearly obligated to pay them. He The architectural committee stopped approving house plans and lot owners began to build homes that they thought met restrictions (so they said), but didn't. Some original owners resold their lots to buyers who denied getting copies of the restrictions. In short, houses not meeting restrictions began being constructed, and even though we were very reluctant to get involved, a group of us homeowners called a series of neighborhood meetings to discuss the need to form a HOA.

Against my better judgement but fearing someone would start a pig farm on the 6 acre lot next to me, I agreed to serve on the inital HOA board. We've hired an attorney to file organization papers for us to become legally chartered, and our first meeting to elect board members will be in mid-October. Based on the neighborhood meetings we had to discuss the need for a HOA, I won't be surprised to wake up some night and see a cross burning in my front yard...

Grumpy, one possible source of information might be the Community Association Institute. I'm not a member but it does look like they could help answer your questions about what an association can and cannot do. Good luck.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 03:35 PM   #7
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Re: Homeowner Associations/Condo Associations

In our state the declarant (the developer) determines when transition to homeowner control of the HOA will take place. In our community the developer filed documents that specify that transition will only take place when 100% of the lots are no longer owned by the developer.

Because the developer was unresponsive to our requests for information, a group of us homeowners started what we have called a Home Owners Transition Working Group (HOTWG). We have obtained information from CAI and are proceding with gathering the information we will need to understand how to run the association. We have met informally with a lawyer who specializes in HOA law. We have also reestablished the residents' discussion forum on a server not controlled by the association.

Since we are a "55 or better" community we have lots of folks who are retired and have time to devote to these efforts. We have no trouble getting a large turnout for meetings. Last year the developer proposed placing a large number of condominiums within the community. We mobilized the local politicians and conducted a survey which showed 82% of the homeowners were opposed to the condos. The zoning request was defeated.

I have been filing official requests under state law to obtain supporting documents for the association's monthly financial reports and have been submitting written questions to the managment agent. These efforts forced the Board to appoint an official Finance Committee (big surprise, they didn't appoint me to that committee). I now attend the committee's monthly meetings and continue to raise questions that the developer finds embarrassing. Having been the financial manager for the Hubble Space Telescope, with a budget of $1.5 billion it is tough for the board to hide much from me in the association's $1.5 million annual budget .

Grumpy

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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 03:59 PM   #8
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Re: Homeowner Associations/Condo Associations

Grumpy: love it!!

Interesting that the developer can hold the homeowner's assn until 100% sold out.

There are often provisions in those documents that are not consistent with law. Check with a local attny to verify that he can hold out that long.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 04:00 PM   #9
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Re: Homeowner Associations/Condo Associations

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Originally Posted by grumpy
Since we are a "55 or better" community we have lots of folks who are retired and have time to devote to these efforts.
I would think that there'd be nothing more terrifying to a developer than a bunch of retired lawyers, accountants, & publicists looking for a challenge. *Maybe it's time to have an informal meeting with one of the developer's execs, hopefully one who doesn't have any face to lose or any personality conflicts (yet), and communicate how doggedly you guys are willing to pursue the resolution. *Show them your new discussion board at http://www.ourdevelopersucks.com * and tell them you're ready to go to the media. *The developer could pay you now or pay the lawyers forever...

Do your state laws require the developers to turn over the association with its reserves already funded, or are they going to try to slide out of that one too? *Funding the roof/painting reserves is a pretty big assessment.

Our bedroom community is 14,000 homes under a homeowner's association running seven recreational centers, an after-school/intercession program, a professionally-published monthly newsletter, a huge warehouse of landscaping/road maintenance equipment, a plant nursery, and a full-time office. *The design & décor rules are not popular, but failing to obtain permission before repainting your home (even if you're using the same colors) is subject to a $100 penalty. *The office people, whose supervisors are certified managers, can be absolute Nazis about the rules. *(Lots of homeowners sneak around to get their painting done.) *The condo & townhome developments also have their separate associations, so a condo owner could be paying $200 a month to their association and another $30/month to the community association.

I think the smaller the association, the shallower the talent pool and the more opportunities for apathy leading to board power-game shenanigans. *OTOH if the board turns over community management to a professional management assocation like this one, the community would have access to professional services like association legal experts, mediation, and career managers with a slew of acronyms after their names who know how to make the developers blink.

* No, that's not a real URL. Not yet anyway.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 06:02 PM   #10
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Re: Homeowner Associations/Condo Associations

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Originally Posted by Nords
I would think that there'd be nothing more terrifying to a developer than a bunch of retired lawyers, accountants, & publicists looking for a challenge. Maybe it's time to have an informal meeting with one of the developer's execs, hopefully one who doesn't have any face to lose or any personality conflicts (yet), and communicate how doggedly you guys are willing to pursue the resolution. Show them your new discussion board at http://www.ourdevelopersucks.com * and tell them you're ready to go to the media. The developer could pay you now or pay the lawyers forever...

Nords,

We are dealing with an "LLC" (limited liability corporation) that is a subsidiary of a very well known national builder. Once the homeowners get control of the HOA the LLC will no longer have any assets so there will be nothing for us to gain via a suit at that point.l That is why we wrote a letter to both the corporate VP responsible for our area and to the founder and CEO of the parent corporation to communicate as you suggest. That was in July. We received absolutely no response!

Do your state laws require the developers to turn over the association with its reserves already funded, or are they going to try to slide out of that one too? Funding the roof/painting reserves is a pretty big assessment.

Yes, the law requires that the reserve be funded in accordance with a professionally done engineering study that is updated at least every 5 years. The study calculates requirements starting from the amount of reserve funding stated by the board to be on hand as of that date. The value provided to the engineering firm by the board was a drastic overstatement of the amount actually on hand. We are watching that one carefully.

Our bedroom community is 14,000 homes under a homeowner's association running seven recreational centers, an after-school/intercession program, a professionally-published monthly newsletter, a huge warehouse of landscaping/road maintenance equipment, a plant nursery, and a full-time office. The design & décor rules are not popular, but failing to obtain permission before repainting your home (even if you're using the same colors) is subject to a $100 penalty. The office people, whose supervisors are certified managers, can be absolute Nazis about the rules. (Lots of homeowners sneak around to get their painting done.) The condo & townhome developments also have their separate associations, so a condo owner could be paying $200 a month to their association and another $30/month to the community association.

I think the smaller the association, the shallower the talent pool and the more opportunities for apathy leading to board power-game shenanigans. OTOH if the board turns over community management to a professional management assocation like this one, the community would have access to professional services like association legal experts, mediation, and career managers with a slew of acronyms after their names who know how to make the developers blink.

Our association is managed by a professional management company but they are under contract to the developer controlled board. The board has its own attorney but again that lawyer is an agent of the developer controlled board. If we homeowners what to consult a lawyer we have to do so using our own personal funds, we cannot get access to association funds even though the association funds are from the monthly assessements we pay.

* No, that's not a real URL. Not yet anyway.
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Re: Homeowner Associations/Condo Associations
Old 09-08-2006, 11:20 PM   #11
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Re: Homeowner Associations/Condo Associations

Sorry to be so blunt but IMHO, hoa's are usually run by nitpicky power hungry assholes. I had a very bad experience with one a few years ago, and I vowed to never buy property in another association. WHo needs some jerk telling you what you can and can't do? anyway, I am not alone in my feelings about HOA's, I see alot of backlash against them here. MY property value is actually signifcantly higher than comparable homes because we DONT have any HOA to bust our chops. :P
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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 12:33 AM   #12
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Re: Homeowner Associations/Condo Associations

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Sorry to be so blunt but IMHO, hoa's are usually run by nitpicky power hungry assholes. I had a very bad experience with one a few years ago, and I vowed to never buy property in another association. WHo needs some jerk telling you what you can and can't do? anyway, I am not alone in my feelings about HOA's, I see alot of backlash against them here. MY property value is actually signifcantly higher than comparable homes because we DONT have any HOA to bust our chops.* :P
This has been my experience with HOAs. When DW and I bought our first home, the real estate agent convinced us that it was unwise to buy anywhere that didn't have and HOA. We quickly learned that anyone willing to run for HOA board was actually unfit to hold the position. Each one seemed to have their own personal axe to grind. "Power hungry @ssholes" pretty much describes what we saw. They ignored anything that didn't affect them, drove their own costly agendas and taxed the association as much as it took for their pet projects. Since then, whenever DW and I went house shopping, the first thing we tell the real estate agent is that we will not buy any home with an HOA.

I'm pretty sure this is all Clinton's fault.
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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 06:44 AM   #13
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Re: Homeowner Associations/Condo Associations

Quote:
Originally Posted by Alex
Sorry to be so blunt but IMHO, hoa's are usually run by nitpicky power hungry assholes.
Quote:
Originally Posted by sgeeeee
This has been my experience with HOAs... We quickly learned that anyone willing to run for HOA board was actually unfit to hold the position. Each one seemed to have their own personal axe to grind. "Power hungry @ssholes" pretty much describes what we saw.
I would like to think the above comments don't apply in my situation as a HOA board member.

In Cut-Throat's case, he will have to speak for himself.

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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 10:40 AM   #14
 
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Re: Homeowner Associations/Condo Associations

Quote:
Originally Posted by Alex
Sorry to be so blunt but IMHO, hoa's are usually run by nitpicky power hungry assholes. I had a very bad experience with one a few years ago, and I vowed to never buy property in another association. WHo needs some jerk telling you what you can and can't do? anyway, I am not alone in my feelings about HOA's, I see alot of backlash against them here. MY property value is actually signifcantly higher than comparable homes because we DONT have any HOA to bust our chops. :P

HOAs are not for everyone, so you have to ask yourself if you want to abide by the rules. If you think the rural areas in Arkansas with broken down washing machines and old couches in the front yard have country 'charm', I suggest you not even look at an HOA. - And guess what! - The people who like an HOA - really, really do not want you to move in. Especially guys like me on the Board!
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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 11:17 AM   #15
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Re: Homeowner Associations/Condo Associations

Once the developer is gone I don't think the HOA governance will be much different than other local politics. In effect, our HOA covering 800 homes, will be like the local government of a very small town. The Board of Directors will function like the town supervisors. The only real difference I see is that the HOA will not have to deal with police and fire services. Otherwise the HOA will deal with the same issues as any similar sized community.

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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 11:28 AM   #16
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Re: Homeowner Associations/Condo Associations

Imagine what might befall the poor devil who paints his house the wrong shade of oatmeal!
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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 11:51 AM   #17
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Re: Homeowner Associations/Condo Associations

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Imagine what might befall the poor devil who paints his house the wrong shade of oatmeal!
If you'd ever served on a HOA board you would not appreciate the humor in that statement...
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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 12:44 PM   #18
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Re: Homeowner Associations/Condo Associations

Quote:
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I would like to think the above comments don't apply in my situation as a HOA board member.

In Cut-Throat's case, he will have to speak for himself.

As far as I know, I have never lived in a place where your or Cut-Throat sat on an HOA board. But let me talk some specifics:

1) The guy next door has friends from North Dakota come and park a large bus-sized camper in the street in front of their house. They stretch a drop cord and a hose from the front window, across the yard and sidewalk and create a hook-up. After a few days and having to step over the hook-up every time I go for a walk, I talk to my neighbor. He tells me his friends are staying for a month and I can go f*ck myself. So I appeal to the HOA. Guess who is on the HOA board? So the board comes back and tells me they have taken action. The homeowner and board member have been given 90 days to correct the violation.

2) "Friends-from-ND" guy moves away. New guy moves in on the other side of my house and promptly runs for the board. He runs some kind of business out of his house. Whatever it is, it involves him filling his garage with boxes wall-to-wall and floor-to-ceiling once or twice a week, then parking a semi in front of the house and blocking my driveway for an hour or so while he loads and unloads boxes. I get caught unable to get in or out of my driveway a handful of times and approach the guy to ask what he's doing and if he can avoid blocking my driveway. He is vaugue and slippery about what he is doing but promises not to block my driveway anymore. But he does over and over again and the frequency gets higher. I go to the HOA board. I am informed that a board member went by my house and there was no semi blocking the drive. The next time it happens, I should be sure to notify the board and they will send someone by to check within the next two days.

3) The battle with "semi-in-my-driveway" guy escalates. The next time I am blocked in, I call the police instead of the HOA. They come out and ask him to move the semi. He fails the intelligence test and refuses so they write him an expensive ticket. I think the whole thing will finally end. But "semi-in-my-driveway" guy decides to start a war using the board. I begin to get regular threatening letters from the board. I was one of the first to move in to the development and put in a Sonora desert landscape (cactus, yucca, palo verde, mesquite, ocotillo, ... with gravel and no grass). One letter says the board is going to pass a new rule to outlaw non-grass landscaping and I am being warned that I need to re-landscape my yard before the next board meeting. I walked through the development and knocked on the door of every house that had similar landscaping. I gave them a copy of the letter and found that not one other homeowner had gotten the letter. Most of us showed up at the next board meeting and were able to stop the rule change. Another letter notes that I had received and exception and allowed to build a tool shed that stuck above my fence by 2 inches (so it was visible from the front yard. The board decided to rescind the exeption and asked me to tear down my tool shed. Interestingly enough, I had planted a sage plant in front of that fence and a palo verde tree in front of that in the years between getting the exception and getting the letter. The sage completely covered the 2 inches of previously visible tool shed and you couldn't see that from the street or sidewalk. Unless someone walked into my yard and ducked down under the palo verde branches, they couldn't even see that section of fence.

I lived in that development for 14 years and could continue telling these stories for a long time. My HOA fees became outrageous as various board members decided to completely redo the landscaping in all shared areas in the development because they wanted the plants in the common areas to match their own landscaping, decided to heat the swimming pool (remember, I live in Phoenix, AZ) because they wanted to swim that extra two months out of the year, etc. Yet when I needed the board to do the kinds of things I felt they ought to do, they were useless. I'm sure there are reasonable HOA boards out there somewhere, but they are not part of my experience. And I see no way to insure that an HOA board actually remains reasonable.

As to the idea that HOAs prevent a neighborhood from turning trashy, I have found that HOA rules are almost always redundant with city ordinances. It may take longer to get the zoning police from your city to come out and take action, but you don't have to worry about them parking semis in your driveway or establishing RV parks at your curb.
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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 01:17 PM   #19
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Re: Homeowner Associations/Condo Associations

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As to the idea that HOAs prevent a neighborhood from turning trashy, I have found that HOA rules are almost always redundant with city ordinances. It may take longer to get the zoning police from your city to come out and take action, but you don't have to worry about them parking semis in your driveway or establishing RV parks at your curb.
I do understand that some HOA's take themselves too seriously, play favorites, and are generally a PIA. I plan to do my best as a board member to see that doesn't happen.

As far as redundancy with city ordinances, our subdivision is located well outside any city and there are no county ordinances or zoning regulations. The subdivision CCR's (Covenants, Conditions and Restrictions) are the only thing we have to protect us from having something like this next door:




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Re: Homeowner Associations/Condo Associations
Old 09-09-2006, 01:46 PM   #20
 
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SG,

HOAs are only good as the people that live there. That is one reason I chose to live in a small one - 14 owners. One small private Cul-de-Sac.

But generally they work as well as governments do. If the voters don't pay attention and educate themselves you might end up with a 500 Billion Deficit -
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