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The Real Estate Corner
What you should know about homeowners associations
Wednesday, February 15, 2012 • Posted February 17, 2012 9:28 AM

If you’re planning to buy a house or condominium, keep in mind that the property may be governed by a homeowners association. An estimated 4.8 million Texans live in communities managed by HOAs.

Many homebuyers appreciate the benefits provided by HOAs, but the mandatory dues and covenants, conditions and restrictions placed on the group of homes occasionally rub some people the wrong way. Before you make an offer on a property governed by an HOA, here are some things to consider.

What’s in it for you? – Homeowners associations often provide access to attractive amenities that individual residents couldn’t otherwise afford – pools, gyms, tennis courts, walking trails – and their rules can protect property values in the neighborhood. Some associations also take on services traditionally provided by the local government, such as trash pickup, landscaping, street lighting and street and sidewalk maintenance.

Beyond the golf course – Your perfect condo may have a great pool or your dream house might be sitting on the first tee, but remember that those things are only part of the HOA’s scope. When you purchase a property governed by an HOA, you enter into a legal contract with the association. You agree to abide by the association’s regulations and pay its dues. In exchange, you get a community guided by an HOA and the access to its facilities and perks.

Read before you buy – Make sure that any uses or freedoms you expect to come along with your property are allowed in the CCRs. Want to store your boat trailer in your driveway? The association’s CCRs may not allow that. Want to paint the house? Some HOAs have restrictions on permissible colors, so check the palette allowed by the association.

Reforming the rules – Texas realtors supported several HOA reforms during the most recent session of the Texas Legislature that enhance the rights of property owners who belong to HOAs. In fact, the efforts of the Texas Association of realtors led to changes in state law now in effect. Homeowners in HOAs are now guaranteed the right to place religious displays on their front doors; fly U.S., state and military flags; and install rain barrels and solar panels on their property.

In addition, new laws require HOAs to hold open meetings and make records more accessible to all HOA members. The associations also are now required to see a judge to foreclose on homeowners who are behind on their dues and offer homeowners a payment plan if they are behind on payments.

HOAs run on dues – your fee for living in the community. Some are charged quarterly, some annually. These fees range from less than one hundred to thousands of dollars, depending on the neighborhood or building and what amenities it offers. Ask how much the dues are when you’re house hunting, if they’ve increased during the past few years and how often you are required to pay them.

In addition, find out what the dues cover and what they don’t. For example, your condo association may perform all exterior maintenance. That means when the roof leaks, your dues pay for its repair, even if you live on the ground floor of a three-story building.

Who’s in charge? – When you review an HOA’s documents, be sure to ask about its finances. Is the HOA solvent? Does it have a reserve fund? Who controls the money? What kind of oversight is that person subject to?

Find out who manages the HOA and what role residents have in its governance. There may be a board or other group of property owners who are elected to manage the association. Take some time and talk to people who currently live in the community.

It’s in your best interest to perform due diligence before signing a contract to purchase a property governed by a homeowners association. You’ll be able to make an informed decision about the HOA’s pros and cons, as well as your responsibilities, without jeopardizing the transaction or subjecting yourself to regulations that aren’t consistent with your lifestyle.

For your real estate needs, contact RE/MAX Genesis at 830-833-2000.

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