Category: Opinion

Posts by GKS

HOAs and affordable housing — Say what??

Are HOA Dues Making Real Estate Unaffordable?  Read this very instructive analysis.

Let’s imagine that a lender allows 31 percent of your income for housing-related costs, and that two buyers have a combined income of $6,000 per month.

This means up to $1,860 can be spent on the mortgage, insurance, property taxes and HOA or condo fees. If insurance costs $100 per month and taxes are $300 per month, then the borrower has $1,460 available for mortgage payments.

Based on income, you’d probably qualify for a 4.25 percent, 30-year, fixed rate mortgage for roughly $296,750.

Add $270 in HOA dues, and just $1,190 is available for mortgage payments — the loan amount falls to 241,900– $54,850 less, enough to make many properties unaffordable and off-limits.

There’s an impact of HOA dues on size of mortgage you can qualify for. Obviously you get less when HOA dues enter the picture. So, why are the pro-HOA proponents still talking about HOAs as affordable housing? Why?

Where’s the full disclosure?  Isn’t this false advertising and misrepresentation?

 

 

NJ HOA constitutionality bill – fair elections

I am pleased to see that 2 legislators (Assemblyman Bob Andrzejczak and Bruce Land) in the NJ Assembly understand HOA constitutional issues and have sponsored a bill, A-3163, accordingly. Herald.com (Cape May County NJ) reports,

“Homeowner’s Associations must operate under similar rules and procedures as other governing bodies,” Andrzejczak said.  “A resident’s interest and right to approve and elect board members must be preserved. And setting clearer, more fair and unified set of rules for board elections and a clarifying a resident’s ability to recall will help to do just that.”

Bruce Land adds,

“Homeowners living in developments are still consumers and must be protected under the law,” said Land. “Ensuring their right to fair elections and protecting their right to choose board members, who will make decisions on their behalf, is a measure of consumer protection that they simply deserve as property owners.”

Homeowner rights advocates in other states must follow this lead and fight for similar HOA constitutional reforms. Six major issues to be pursued can be found in HOA Common Sense: rejecting private government.

Consent to be governed, No. 4

Democratic elections, No. 5

Fair and just hearings, No. 6

HOA Boards can do no wrong, No. 7

Draconian punishment and intimidation, No. 8

HOA Governments in fact, No. 9

In general, on the question of the validity and legitimacy of HOA governing documents and pro-HOA state laws, read:  CC&Rs are a devise for de facto HOA governments to escape constitutional government.

LA Times column: protecting your HOA property

The LA Times article by  Donie Vanitzian on property rights and HOAs (The time to protect your real property assets is before any HOA litigation) is excellent!

 “Each titleholder’s real property in a common-interest development may be pledged as collateral for any association loans, which may be obtained without approval from owners. That leaves titleholders to pay the mortgage bill through special assessments or homeowner dues. These assessments are in essence a lien, levied against each property until the association’s loan is paid off. When owners sell their property, the buyer either accepts the lien with the sale or the seller has to pay the lien off before the sale. That’s just one complication.”

It is another in a long series of invaluable information provided to help homeowners and not the HOA corporation that has its own attorney.  The Vanitzian column in the LA Times fills a void in full disclosure that the pro-HOA special interests with their paid lobbyists avoid and fall silent.

Did any of those CAI HOA surveys ask respondents how they felt about these HOA powers?  I wonder.

AZ Gov has concerns about regulating HOAs — Why?

I find it utterly incomprehensible that AZ Sen. Farnsworth and Governor Ducey have concerns about regulating HOAs as mentioned in this article in the Arizona South Mountain District News.
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Homeowners living in HOAs, being private, contractual agreements, are not under the protection of the US and state constitutions!  What don’t they get?  These unapproved CC&Rs contracts allow private people to bypass local constitutional government and operate as independent entities or principalities.  Even the most lenient home rule communities must answer to and be bound by the constitutions.  Not so with HOAs.
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It speaks to the overwhelming power of the special interest controlling our government.
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And they have concerns about regulating HOAs!  They have an obligation to support the Arizona Constitution and not allow local community governments to secede from the state.
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Fed court rules HOA developer as deceptive

We are all aware of the reported incidents where developers have failed to meet their contractual obligations and fiduciary duties to the HOAs that the created.  Failure to maintain the development, poor and non-existent records, and developer appointed boards, etc.

Well a federal bankruptcy court judge in Miami, Florida came down hard on such practices that forced an HOA into bankruptcy.  “The court ruled that D.R. Horton, America’s largest homebuilder, engaged in deceptive and unfair trade practices and breached its fiduciary duties.”

Read the article, “Judge says ‘greedy corporate giant’ must pay $16.3 million to Miami Gardens condo.”

As an important aside, I’m waiting for someone or some organization to sue for misrepresentation, false advertising, and fraud in the selling process.