Posted on 10/29/2018 6:13:49 AM PDT by Kaslin
In the 2000s, the Parkers thought they were buying their dream home. It was advertised at an excellent price and came with customizable options. The home was located in Peoria, Arizona, adjacent to Phoenix. The development was new, with an HOA managed by a management company.
While the Parkers were viewing the house, they asked the salesperson if they would be able to expand their three-car garage to a four-car garage. The sales person said yes, that would be no problem.
In 2016, the Parkers proudly put up a campaign sign in their front yard for Donald Trump, the only homeowners in the development to do so.
Mr. Parker was elected to the HOA board for awhile, but left after getting frustrated. But while there, the family learned the rules for additional building on the property and complied when they started their garage addition. This meant sending a letter requesting permission to the HOA board along with a copy of the plans and the permit from the city. Per the HOA rules, if the HOA board doesnt respond to a request within 45 days, its deemed approved.
A few weeks later, the city asked them to change their building plan slightly. They made the changes and submitted the revised plans to the HOA. Again, the HOA board did not respond within 45 days, so the Parkers thought everything was fine. They resumed construction of the garage.
On January 9, 2017, when the garage was close to completion, the Parkers received a Notice of Violation in the mail from the management company. It did not specify any offense. They were then contacted by the Architectural Review Committee, a subsidiary of the HOA. The ARC chairman CCd two neighbors on an email to them. The Parkers figured out he had put two of his neighbors on the ARC but there hadnt been a meeting, necessary to vote in officers, since October 2016. They were apparently put on the ARC illegally. An HOA board member was also later added illegally, to replace the president of the board who moved out of the development. The HOA justified it by claiming that A.R.S. 10-3821 applied, allowing them to take action without a meeting. But that law applies to nonprofits, not HOA boards. HOAs are different because they include homeowners who have a right to vote. They are governed by Title 33 of the Arizona Revised Statutes.
The HOA board next sent the Parkers a letter refusing permission to build the additional garage despite the fact that it was already built at this point. The ARC claimed that one corner was too close to the fence. This was because the city had them move the garage back, which changed the distance from 10 feet to 8.2 feet.
The Parkers thought they could submit a variance to take care of the problem. Instead, they received a letter from an HOA lawyer on April 20, 2017. There still hadnt been any HOA board meetings since October, so the legal action appeared to be illegal. On May 5, the law firm sent them another letter, selectively quoting the CC&Rs.
The HOA finally sent out a letter announcing a board meeting in August, almost a year after the last meeting but it was executive session only, so residents werent allowed to attend. The HOA lawyer attended along with the illegally elected board members.
The Parkers asked for mediation. It took place in September. At the mediation, one member on the HOA board suggested fining the Parkers as much as $35,000, as a deterrent to others.
The HOA finally scheduled a board meeting for residents to attend on December 17. It was chaotic, with other residents angry at the way the HOA was treating them. An election was scheduled for January to elect new officers. Ken Palmer ran for president, but the HOA pulled some slick maneuvers to keep him from being elected.
The Parkers finally could not handle any more stress, it was having an effect on Kens health. They were told that even if they were to eventually win, they would have to go through a lengthy appeals process that would cost them $50,000. They worked out a settlement of paying the HOA $10,000. They spent another $13,000 on legal fees. They essentially paid a lot of money to make it go away.
The management company was started in the 1990s. It has expanded to manage 700 HOAs. It operates in five states. There are thousands of employees. They collect payments, bank them, keep records, pay for insurance, hire vendors, manage the property, fix sprinklers, pay for a community manager to be on call, manage meetings and make filings at court. They also manage pools and common areas in the HOAs that have them.
Officially, the management company receives nominal reimbursement from homeowners fees. But they actually make their money from secret affiliate fee arrangements. In order to bid on projects in the development, vendors must join the Community Association Institute. That requires them to give a hefty kickback of 20 to 30 percent to the management company on each project. That money is how they are able to litigate against homeowners. The management company also makes money suing homeowners over HOA fines. If they dont keep up with the fines, they foreclose on their homes and flip them, making a profit.
Free market proponents dont want to regulate HOAs because they consider them private associations. But several court decisions have held that they are quasi-governmental. Phoenix lawyer Jon Dessaules, who represents homeowners in lawsuits against HOAs, observed, "Homeowners associations really are privatized government without accountability. We can control everything from what you paint your home to when you cut your yard, but we arent accountable to you and dont have to respond to you." They are similar to Public-Private Partnerships, which entail government granting monopolies to favored corporations which no longer act like free market entities and are controlled substantially by government. Local governments authorize developers to include HOAs. Since 90 percent of the new houses in Maricopa County are located within an HOA, it is almost impossible to avoid them.
The Parkers believe they were originally targeted because of their Trump yard sign. Many of the people attracted to serve on HOA boards are little Napoleons, eager to flaunt their power over others. This totalitarian mindset should not be allowed to abuse people for their politics. Fortunately, Arizonas Governor Doug Ducey is cracking down on HOA abuse. One bill would have helped the Parkers, requiring HOAs to treat all of their meetings as open meetings. But its too late for them.
I was appointed to fill a seat on our HOA in California. I found that most Board members had their own agenda and, after getting the things they wanted personally, they would drop off the Board. Not kidding. After my seats term expired, I left the Board but allowed myself to be appointed to the Architectural arm of the Board. My philosophy was if it enhances the house, it is all good for the neighborhood. Really glad we left California and no longer live in an HOA controlled neighborhood!
Understood. I’m in the HOA industry and live in an HOA. Your association must have been a nightmare if the community dissolved it. HOA stories are like bad cop stories. Over 400k HOAs in the country, one board behaves badly and suddenly they are all evil. I love my HOA and live here because of the rules. My other home wasn’t in an association and lost value. This home has appreciated by 75k in the last two years.
Our home values went UP when the HOA was disbanded. Homes sell faster with “No HOA” in the advertisement.
“Yes, there are rules. If you don’t like them, don’t move here. Do not move here and assume that the rules don’t apply to you. If you don’t like a rule, get involved and change it (if you can garner the support of the community, but don’t be surprised if people like the rule.).”
The problem with HOAs is that the rules keep changing or that the rules are allowed to change.
Heard the: “if you don’t like the rules you can leave” line from a HOA official. Geeze not like we were living in a tent that can be packed up and moved?
I’d rather live in my truck.
Yes, HOAs vary. My daughter likes the one she lives in. Small homes on small lots and HOA-maintained roads and playgrounds. Our HOA had no commonly owned property - which made it easy to dissolve - and the homes are on 1-2 acre lots.
As an example of what went on...the “Architectural Committee” banned the owning of horses so it wouldn’t come up for a vote. They obviously had no authority to do so. Those who owned horses agreed to hire a lawyer to fight the HOA. The HOA’s lawyer advised the BOD what was happening was illegal. The BOD finally backed down, but so many were angry about it that the BOD was recalled. The next BOD took a relaxed approach, things got better, then the BOD after that tried to limit the number of cars people owned, again by trying to use the Architectural Committee. They were recalled, and so it went.
When the HOA has no common property, and only functions to allow the friends of the BOD to harass their neighbors, they are a nightmare. I’ll never buy another home in an HOA. But there are good ones too. I think a lot depends on the CC&Rs and the governing rules of the HOA, combined with the type of community it is. An HOA isn’t a good match for a place where a lot of folks keep horses on their property...
Keep records of this. Non-enforcement of the HOA rules is a means to abolish the HOA, and/or set precedent if they target you in the future for some perceived infraction.
My other favorite part of this hot mess article was the paragraph talking about the letters selectively quoting the documents. Letters quote the documents so that owners can see exactly what section is under dispute. The attorney usually reviews the sequence of events to ensure compliance because when they issue any letter, they are now liable for the representations in it. If they had been wrong, the court would have smacked the association and the lawyer for improper processes.
I got a big laugh out of the owners thinking the realtor who sold them the home had ANY authority to say what the HOA would allow. The realtor has no authority and should have referred them to the Association board or manager for that. Realtors work for the seller, not the Association.
Whoever wrote this did not do their research.
We cannot continue to allow HOA’s or private companies to run end-arounds on the Constitution.
Sounds like some poorly trained volunteers were on your board not taking solid legal advice. A recipe for disaster. Made sense that you dissolved it
HOAs like, say time-shares, turn into a nightmare for many unassuming people. Don’t do this to yourself ... no matter how attractive it may appear at first.
1st house: May 1966.
2nd house: January 1989.
3rd House: Feb 2005.
NEVER even would look at a house with an HOA or CC&R’s.
NEVER have & NEVER will.
They rarely produce harmony among the home owners.
That is a good point, and once again being involved is the best way to have the community you want.
If reflection, I have to say that there are good HOAs and really bad HOAs and I am not defending all HOAs. My comments were only to point out that not all HOAs are bad.
Pure nonsense! HOA's are a private contract between homeowners, entered into on a voluntary basis for mutual perceived benefit. If you wish to live in a manner that is detrimental to your neighbor's comfort and property values, do it elsewhere and enjoy all of your Constitutional rights. Swine prefer living among other swine.
My first HOA experience was in NJ. We lived in a town house development. About a month after we moved in, we painted the front door and rear door. Immediately received a letter saying we were out of compliance. HOA rules said all exterior facing objects must be painted Tudor Brown, which is what we did.
We didn’t change the paint. About a month later we received a fine for 100 dollars saying if we didn’t repaint the door Tudor Brown we will receive a fine of 1000 dollars and a notice that the association will take legal action. I still didn’t repaint the door.
Of course I received a fine and a legal notice. The person running the HOA was an Orthodox Jew who lived in our development. I showed up on his doorstep with the gallon of Tudor Brown paint I used to paint the door as well as the contract. He said the paint I used wasn’t Tudor Brown.
I said look at the paint can, what does it say. He said it says Tudor Brown but isn’t the correct paint. The development uses a different brand. I said to show me in the contract where I must use a certain brand of Tudor Brown. It wasn’t in the contract. So he said, the Association will purchase the correct paint for me and they will even paint my door. He said it was the least they could do for the 1100 in fines I was supposed to pay.
Last thing I said before walking away was F*&king paint Nazi. He heard it and followed me back to my townhouse, yelling at me all the way there. Over the next few months, I started to notice that my garbage cans that put out on the street for garbage collection weren’t being emptied, my lawn wasn’t getting mowed and I was receiving notices that I was parking illegally.
At the next board meeting I brought this up. People started to come over to me and tell me he does that to everyone. He was gone within the month. No one stood up to him so he continued with his antics. Lesson learned, fight for what is right, regardless of your politics.
People should not assume they can just ignore them. Most of the problems arise because people just ignored the letters.
If they have a bank account with your neighborhood's name associated with it, it's only a matter of time before the need for community property becomes a hot topic. In order for that to happen, the kind of an hoa must become an incorporated HOA with things in place to protect the HOA board of directors from the evil homeowners, like the power to FORECLOSE on homes that will not comply with rules, pay fines or pay dues. Never trust these people, and try to put together an opposing group of home owners that feel strongly against any HOA infiltration, before it gets worse.
Looks like Peoria Illinois.
“Helps maintain property values.”
If you don’t plan on moving it doesn’t matter. Let’s say all HOA houses double in value relative to non HOA houses. If you move to another HOA house you sell and buy at same price. Ditto the non-HOA house. However you pay more than twice the property taxes. I would prefer my home be worth $5 than $5 million. Does it matter if it is worth $5 million as long as I have to live in one?
Does it matter if your socks are worth $50 or $1? Which would you prefer? You needs socks.
At our HOA meeting, a member complained about the yard signs being against HOA rules. The member had several Democrat signs in their yard but they were complaining about the Republican signs at a house at the beginning of the neighborhood. They claimed their signs weren’t a problem because they lived so far into the ‘hood.
Classic political hypocrisy.
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The FTC should persue RICO action to shut down all HOAs.
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