Our article on homeowners associations elicited a strong reaction from both sides of picket fence.
May 18, 2004: 12:11 PM EDT
By Sarah Max, CNN/Money senior writer
BEND, Ore. (CNN/Money) - Do you hate your homeowners association? We raised this question in an article first published in March, and our inbox has since been flooded with emails.
Just to recap, homeowners associations are increasingly common in new housing developments. An estimated four out of five houses built since the late 1990s belongs to a such an association, according to the Community Association Institute (CAI).
Residents who live in these neighborhoods pay annual or monthly dues to help maintain common areas such as roads, parks and pools. They also agree to abide by a set of rules typically encompassing everything from what color they paint their houses to where they park their cars.
The majority of homeowners are happy with their associations, said CAI spokesman Frank Rathbun, because they give owners access to amenities they may not be able to afford on their own – such as swimming pools and private security – and they help protect property values.
"It's like any other aspect of life; if it's done poorly the results will reflect that," said John, a reader who said he has lived in a community association for 30 years. "If it's done well, however, the results can pay valuable dividends to the members."
But critics – and there are plenty – argue that these bodies have too much power and not enough oversight. Particularly worrisome is that in most states homeowners associations have the right to foreclose on a home if dues are not paid.
"Associations have gone from having covenants with just a few simple rules to Big Brother-type of organizations where [residents] cannot have the freedom to do what they want to a home that they, not the association, are paying for," wrote Leslie, a reader who said she has lived in an association for 10 years and is deliberately moving to a neighborhood without one.
"I just finished reading your article and all I can say is, 'Wow! I am so lucky,'" said Lisa, a reader in Pennsylvania who lives on 250 acres where she can do anything she wants. "Why would anyone want to live this way?"
Strong opinions for and against
"I, too, truly hate my homeowners association," said Don, a reader in Colorado. "They now go way beyond [a] 'common good' purpose and try to form neighborhoods into the administrators' personal visions of Utopia."
His biggest complaint is that he is required to have a lush lawn even though water is extremely scarce. He'd prefer to plant vegetation that does well in the arid climate, he said, but that's prohibited.
"So, you might ask, why did I move here to begin with?" Because his housing association controls most of the new development in his area, he said. "Unless you want a two-hour commute, you're stuck."
But rules need to be enforced to protect property values, said other readers.
"We have belonged to two HOAs, and my husband served many years on the board of one," said Nancy, a reader in California. "There have been many disagreements, and I cannot recall one in 26 years, which was not the fault of the homeowner.
"We have watched our quality of life and the appearance of the places in which we live be grievously affected by these people, who behave like spoiled children," she said.
The solution? "Don't live here!" she said.
Is there enough disclosure?
One criticism of homeowners associations is that buyers often do not understand the full implications of living in a particular neighborhood until it's too late to back out.
"I'm a real estate attorney and have served on the boards of numerous homeowners associations for over 25 years," said Eric, a reader in California. "This article was a rant against HOAs, and filled with misinformation."
"Especially egregious," he said, "was the statement that CC&R aren't disclosed until the close of escrow and/or until they can't get out of the deal, which is flat out wrong, at least in California."
Still, we heard from quite a few readers calling for better disclosure of association rules.
"At no time do real estate agents mention them," said a reader from Jacksonville, Fla.
"We were never informed of the existence of such an association until days before closing on our home," said Jeff of Massachusetts. "If we had known of its existence in advance, it may well have swayed our buying decision."
Is foreclosure too harsh a punishment?
One example that drew quite a bit of reaction was of Tom and Anita Radcliff, a retired couple in Calif. whose home was foreclosed on by their association because they did not pay the $120 in annual dues they owned.
"After hearing about the old couple who lost their house for a $120 check they forgot to send to their association, I know even more why I would never move in such a neighborhood," said one reader. "Homeowner associations should be banned."
But proponents of associations point out that the Radcliffs could have avoided foreclosure by simply paying their fair share. "I do quite a number of foreclosures, of the kind you mention being 'out of proportion' to what is owed," said Barbara, a condominium association lawyer in Connecticut.
"Foreclosure may seem harsh," she added. "But from my vantage point it is the only way folks know you are serious, and that the common charges must be paid regularly just like your mortgage, electric and water bills.
"The non-paying unit owners often say to me, 'Why foreclose when I only owe a few hundred or a few thousand dollars?' I answer, 'Show me the money.'"
posted by Las Vegas # 1:23 PM 
