The Common HOA (POA) Lies

By Don DeBat

Original article from Loop North News

If you study the evolution of homeowners associations (HOA or POAs) often referred to as Common Interest Developments (CID) you will quickly begin to see a familiar pattern develop in the stories this industry uses to justify its existence to a public that is growing increasingly dubious. Listed below are the five most popular HOA whoppers.

The 1st  Lie: Without a Home Owners’ Association, the homeowners would desecrate the neighborhood and destroy the property values. 

“Without the CC&Rs, there are no neighborhood standards to provide guidance and instructions to residents for living in the community. Such things as cars parked on lawns, boats and recreation vehicles kept on premises, unsightly signs in yards, and non-domestic animals kept on residents properties would be the result.”

This is a very common argument that most HOAs use to justify invasive policies of over management. These HOAs invariably paint a picture of a world gone mad in which abandoned automobiles, washing machines, and television sets are strewn about the neighborhood.

In other words, without the “guidance and instruction for living in the community” provided by a Board of Directors, the homeowners would most certainly revert back to the primitive ways of their prehistoric ancestors.

The truth is that the situations that these HOAs describe almost never occur; the overwhelming majority of 116507366conflicts that arise between homeowners and HOAs involve petty squabbles over subjective interpretations and personal preferences. These battles typically erupt over where and what kind of plants can be planted; where, how high, and what color a fence can be; what kind of “passenger vehicles” can be parked on the property and where; when garage doors can be open, and when they can’t; when trash cans can be placed out front, and when they can’t; when a flag can be flown and when it can’t; whether kids can have a basketball hoop or not; and even whether or not kids can play in their own front yard.

The 2nd Lie: You knew what you were getting into when you bought your home. 

“By purchasing a home the area, you accepted the covenants that govern our community and you are bound by them.”  That quote states that the simple purchase of a home in this subdivision constitutes full disclosure on the part of the seller and acknowledgement of all restrictions on the part of the buyer. There is no suggestion that a verbal or written disclosure actually take place. In short, what they are saying is buyer beware.”

This statement is offered as the usual line of defense whenever a board of directors is accused of misconduct. It is an excuse that many homeowners are already very familiar with.

The notion, that it is solely the obligation of the homeowner to determine the true nature of the property, is further emphasized in this next quote:

“…a homeowner is on notice of the existence of deed restrictions/covenants by the very fact that such documents have been duly filed and registered with the appropriate state and county entities.”  What they seem to be saying here is, “catch us if you can.” When you read that passage, you can’t escape the notion that somebody is trying to hide something from you.

The truth is that, although sellers are required to make disclosure of the CC&Rs at some point in the sales process, thanks to the lobbying efforts of the industries trade organization, the Community Association Institute (CAI), the law leaves it up to the sellers own judgment as to when this information should be revealed. Many if not most, homebuyers are unaware of the existence of deed restrictions and are not properly informed of their true meaning by their sales representative.

It is no secret that this confusion on the part of the buyer is created by design.HOA Over the years the CAI has lobbied
legislatures across the nation to limit their responsibility regarding the disclosure of deed restrictions prior to a sale. Consequently, homebuyers are often only made aware of the existence of these restrictions at the moment the final documents are signed. This untimely disclosure assures the seller that the buyer is emotionally committed to the sale and is not likely to back out of a deal when they finally are made aware of the deed restrictions. It also assures the seller that the homeowner will not have an opportunity to read the deed restrictions prior the sale. For the seller, the final moments of the closing of a sale are the most optimal time to reveal the fact that deed restrictions apply.  However, it should be noted that just reading the CC&Rs will not provide buyers with a true understanding of the trouble they may be facing if they decide to purchase the property since nearly all conflicts are a direct result of a board’s interpretation and the creation of restrictions are a direct result of a board’s interpretation and creation of restrictions.

Obviously, the industry feels that timely disclosure of deed restrictions would have a negative effect on sales, and they spend a great deal of time and money lobbying lawmakers to ensure that the buyer is not in a good position to make a well-informed decision regarding deed restrictions.

“The CAI successfully amended bills or worked toward killing bills that could have been harmful to our industry.” – Connie Heyer, lead lobbyist for the Community Associations Institute  

The 3rd Lie: It’s a democracy 

“…the HOA board and the ACC are a democratic organization no different from congress. We attempt to represent the community.”

To anyone familiar with the activities of homeowners associations, the notion that a HOA has any resemblance to an American style democracy is ridiculous. Never the less, many HOAs have tried to foster that very unsupportable notion.

The truth is that, with a high level of homeowner participation, a HOA could operate in a democratic fashion; unfortunately, there never is a high level of homeowner participation. Once the developer turns the HOA over to the homeowners, nearly all HOAs quickly degenerate into an oligarchy.  The reason for this is simple: most homeowners, especially those with jobs and children, do not have the time to participate in HOA activities. This situation creates a void, which often attracts those most likely to abuse the position; it’s a simple fact of human nature and the property management companies and their lawyers depend upon it for their livelihood. The groundwork for abuse is built into the HOA system.

  • Unlike the American system of government, there are no minimum levels of education or competency required to be a board member.
  • Unlike the American system of government, board members cannot be held legally responsible for their actions. They are provided legal representation paid for by the homeowners, and if the board decides to bring suit against a homeowner for any reason, the homeowners will pay for all legal expenses.
  • America’s founding fathers devised a system of checks and balances to insure that even the best and the brightest statesmen the country had to offer would not fall victim to the corrosive influence of unchecked power.
  • Unlike the American system of government, a HOA has no system of checks and balances. HOA board members simultaneously occupy the legislative, judicial, and executive branches without oversight. The board creates rules without homeowner input. In disputes with homeowners, the board acts as accuser, judge, and jury. As for oversight, the board has made it wants no witnesses to or documentation of their activities.

So, let’s sum it up: 

  • No competency requirements
  • No accountability
  • No checks and balances
  • No oversight
  • And full use of the people’s funds to carry out their activities 

The 4th LieWe can’t get anyone else to serve on the board 

Whenever longtime board members are accused of wearing out their welcome they will often raise this defense.

The truth is that, although homeowners do not generally volunteer in droves, the board would have you believe. Over the years, homeowners have volunteered to help out; many of those would be volunteers claim the board greeted them with varying degrees of indifference, rudeness, and in some cases, outright hostility—lots of hostility.

There is no common courtesy or respect. That’s why many people don’t go to meetings

Many HOA boards, do their best to restrict participation to only those individuals who share their own particular views and value system; and with homeowner apathy being as pervasive as it is, it’s fairly easy to do.

The 5th  lie Lie: It’s a thankless job 

That is a line that every board has used at one time or another. Often times it is true that some board members are under appreciated for the good they do. But if this really were such a miserable undertaking than why is it that some board members keep coming back again, and again, and again? 

The truth is that, for some people, being a board member is a very satisfying position with a number of rewards and perks. The types of people that are attracted to, and truly enjoy, these volunteer positions, too often, turn out to be the neighborhood authoritarians, the control freaks; every neighborhood has them. Abrasive and or adversarial personality traits are not uncommon. These people are the lynchpin of the HOA system; management companies and association attorneys depend upon their willingness to engage in conflicts with homeowners to generate a steady flow of income. And, backed up as they are by an institution that would make any third world totalitarian dictator emerald green with envy, they generally prove to be quite up to the task.

 

About the Author

Don Debat
Don DeBat is co-author of Escaping Condo Jail, the ultimate survival guide for condominium living. Visit www.escapingcondojail.com. For more housing news, visit www.dondebat.biz.