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I know federal law doesn't allow HOAs to ban all rentals but can they limit the total to something like
25 percent? This is Texas.
Our patio home community is beginning to make me nervous with all the homes that becoming rentals.
Tenants are fine. The investors buying these homes, however, are doing the cheapest, least amount of maintenance and waiting until the HOA threatens fines until they do something.
If you don't live in an expensive community where home prices are too high to attract investors and flippers, you are at risk to losing home values through no fault of your own.
Location: Danbury CT covering all of Fairfield County
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Yes. I know of at least one townhome community in my market that will not allow more than 25% of units to be rented & there is a former waiting list procedure for new rental units.
My rental properties are limited to two persons per bedroom. i.e. 2 x # bedrooms
I agree that when the number of rentals in the HOA rises above some level it would make me nervous because of too many residents without any real stake in the community. However HOAs enforce bylaws against the most egregious behaviors. Police can also be involved (violation of noise laws).
I lived in an HOA years ago that limited units available for rental at 25%. The quality of life in that complex was quite good, compared to another one that I lived in that did not limit the number of units available for rental purposes.
I'm wondering now how the HOA even knows what percentage of the houses are rentals. I don't recall ever being told I have to inform the HOA my houses are rentals. I am required to register them as rental property with the county and that is a matter of public record. (And serious fines if you rent without registering with the county.)
On occasion I've been on the phone with the HOA and mentioned owning multiple properties when I was discussing one property and got no reaction from them.
I know federal law doesn't allow HOAs to ban all rentals but can they limit the total to something like
25 percent? This is Texas.
Our patio home community is beginning to make me nervous with all the homes that becoming rentals.
Tenants are fine. The investors buying these homes, however, are doing the cheapest, least amount of maintenance and waiting until the HOA threatens fines until they do something.
If you don't live in an expensive community where home prices are too high to attract investors and flippers, you are at risk to losing home values through no fault of your own.
Absolutely. And, frankly, they should.
Many lenders will not lend in a development where there is a high percentage of renters, with the logic that the properties may not hold their value as well as if owner-occupants were living there. FHA generally will not loan in condominiums with more than 50% rentals (there are some exceptions). Many HOAs are more aggressive and say no more than 20% should be rented, or specify that the owners must live in the property for "x" number of years before being allowed to rent. Tenants tend to break the HOA rules more, tend to neglect maintenance, and normally aren't interested in anything that has to do with maintaining the value of a property.
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