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Hi All,
I am on an Hoa board and would like to know what can be done to make our neighborhood less apealing to investors? I've read about changing CC&R's to require buyers to live in the home for two years, unless they could prove they needed to lease it out to avoid financial hardship. My neighborhood was built in 2005 and hit hard by the housing crisis so we have a lot of rental properties. Unfortunately, homes in this neighborhood are still being advergised as "investor specials". We pay higher HOa fees than most other neighborhoods in our area, and yet ours looks awful in comparison due to the rental homes not being keppt up. Many of the investor owned homes are delinquent with their HOS fees as well. Any advice would be welcome!
IT will all depend on what the requirements in your documents for making changes are. In some (and state laws have a lot to do with this) it is almost impossible to change (ours needs a 75% vote of all lot owners for some things) and in others it is much easier.
Then, a change like that probably can't be applied to past purchasers either.
you can definitely make sure you go through the documents and strictly enforce any available sanctions and fines against any houses that are not up to the standard.
Second, you need to get serious about collecting dues. Look at your documents and meet with an attorney. In our state, the HOA can foreclose on properties that are behind on dues, put liens agains the property, seek to collect judgments about the other properties owned by the homeowners.
Third, you need to get serious about enforcing covenants, usage rules, and bylaws about property upkeep. If exteriors are not kept up, contact the homeowners to fix them. Do your covenants have fines for those who refuse to follow the rules? In our neighborhood, landlords are encouraged to include yard maintenance in their rental fees. Yards are kept up and homeowners have someone who is looking weekly at things. Win-win.
Fourth, keep the HOA property looking top notch. Make it a community that people want to live in and homeowners will outbid the investors.
Good luck.
Last edited by GotHereQuickAsICould; 02-02-2015 at 02:22 PM..
I'm far from an HOA expert, but it sounds like your HOA needs to do what HOAs are supposed to do. If the property is behind on their dues, you need to file a lean on the property. If properties are breaking the rules (upkeep and such), you need to follow through with what the HOA laws state will happen (warnings, fines, etc).
I'm far from an HOA expert, but it sounds like your HOA needs to do what HOAs are supposed to do. If the property is behind on their dues, you need to file a lean on the property. If properties are breaking the rules (upkeep and such), you need to follow through with what the HOA laws state will happen (warnings, fines, etc).
"Investor Special" doesn't mean we love investors, we're doing our best to tailor to investors, that kind of thing.
"Investor Special" means as-is, "ours looks awful in comparison", we have problems here, prospective homeowners will not be able to qualify for owner-occupancy loans because of our condition/our rental unit percentage is higher than the percentage allowed for most owner-occupant loans.
You would need unilateral support to change the cc and r's, something to which your investor owners likely would not sign off on.
100% agree on unilateral support.....however, I think you can get you investors behind it, because controlling the investor concentration will only increase market value for each owner. If you continue to have investor runaway, values will decline. Investors do not purchase properties to lose money.
OP, is this condo ownership or townhomes? Can you answer the following:
1). What percentage of units are 30 days or more past due?
2). How many total units? How many are investors?
3). Does any one entity own 10% of the units?
4). Is there any open litigation involving your HOA?
The (wrong) answers for theses four questions are the most common to determine if the homes are eligible (or not) for maximum, owner occupied financing. (I've seen questionnaires have as many as 40+ questions. The investor loans are going thru under a limited review, because they have more down and don't require these questions, while future homeowners have been locked out.
It's one thing to attempt to keep a neighborhood from going to foreclosure and allow owners to rent to get by, than to become the poster-child for every wanna-be investor. I could be off base, but I suspect owner occupied may not be attainable without maximum financing.
Also, if this is a condo, it would be helpful to look it up in the HUD database. It will tell you where you stand.
In ours, HOA fees are the responsibility of the owners, now the renters.
I mant NOT the renters!
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