Homeowners associations (HOAs) have been a fixture in the U.S. real estate market for years. These organizations are typically set up by developers to provide guidelines for homeowners regarding the maintenance and general appearance of their properties. Property owners within these developments usually pay an annual assessment to the HOA to cover the costs of shared projects. Scheduling a consultation with a firm that specializes in Houston real estate law can provide insight into the rights and responsibilities associated with HOAs in the state of Texas.
The History of the HOA
While Homeowner Associations have existed in one form or another for more than 150 years, it was not until the 1960s that these organizations truly came into their own in the United States. Prior to that time, HOA agreements often were used to exclude certain groups from existing communities. In 1968, the Fair Housing Act eliminated these types of HOA agreements. Regulations governing eligibility for federal mortgage insurance also played a significant role in boosting the popularity and use of HOAs in condominium communities and in suburban areas. The passage of the 1977 U.S. Clean Water Act provided financial incentives for real estate developers to establish HOAs to oversee the storm water retention and remediation required by this legislation.
What Do HOAs Do?
In most cases, HOAs provide maintenance for shared public areas that may include swimming pools, parks and green space. They may also enforce covenants, conditions and restrictions (CC&Rs) regarding the appearance and proper maintenance of each property in the neighborhood. Some common stipulations included in the HOA agreement include the following:
- Required yard maintenance and home upkeep
- Landscaping guidelines
- Restrictions on excessive noise
- Parking regulations for residents and guests
- Installation of sheds, playhouses, basketball hoops and other outbuildings and structures
- Vehicle storage, including boats and RVs
- Acceptable exterior paint colors
- Installations of decks, patios and swimming pools
- Mailbox design and décor
- Fences, including height and material restrictions and allowable paint colors
In some cases, HOAs may micromanage the daily activities of their residents to an undesirable degree by creating rules regarding almost every possible situation:
- Limits on the number and types of pets allowed
- Intrusions on personal lifestyle choices and relationships
- Suppression of personal or political expression
- Banning of wind chimes
- Positioning of satellite dishes
Property owners found to be in violation of the CC&Rs may be subject to fines, liens and other punitive actions on the part of the HOA. Depending on the nature of the problem, the HOA may also arrange to remediate certain issues at the expense of the homeowner.
Traditional Powers of the HOA
Most HOAs have the legal power to fine residents for failure to comply with the CC&Rs outlined in the contractual agreement. They can also assess fees for various shared expenses and services. Until 2011, HOAs in Texas also had the power to foreclose on properties without the involvement of a judge, speeding the process considerably and reducing the level of oversight for these legal actions. HOAs can also sue homeowners in court to collect fees and fines and to apply for injunctions against residents.
A Positive Step for HOA Residents
Regulations passed by Texas legislators in 2011 significantly reduced the powers available to HOAs in the state. Some of the most important changes to the previous law include the following:
- Homeowners can decorate their homes with religious displays or flags within certain limits. Generally, religious displays are limited to 25 square inches or less when displayed on front doors. Flags may be displayed on poles 20 feet tall or less.
- Barrels for harvesting rainwater must be allowed in HOA communities within certain limits.
- Solar panels are also allowed under the new legislation.
- HOAs may no longer use non-judicial foreclosure methods to seize properties delinquent on payments to the organization. They will now be required to go through a judge to pursue foreclosure proceedings.
- Owners behind on their fees must be offered a payment plan by the HOA and an opportunity to catch up on these payments before foreclosure proceedings are initiated.
- All Texas HOAs are required to hold open meetings, to keep records and to alert homeowners in the area regarding the date, time and place of those meetings. Failure to provide access to the records of the HOA will be considered grounds for a lawsuit on the part of residents and other members of the general public.
These changes are intended to even the playing field for homeowners in these communities. However, some issues still remain that could create real difficulties for Texas homeowners under the control of HOAs.
Financial Issues with HOAs
Unlike traditional contractual agreements, the CC&Rs associated with an HOA are attached to the parcel of land rather than to an individual homeowner. Membership in the HOA passes to the new homeowner along with the deed. If unspecified annual or monthly fees are required for membership in the HOA, the buyer may be stuck with steadily rising expenses that can significantly increase the overall cost of the new home. In some cases, the HOA fees can actually exceed the homeowner’s monthly mortgage payment. For this reason, it is essential to enlist the help of a Katy real estate law firm when purchasing a property with an HOA in place. These dedicated legal professionals can spot the warning signs that could spell financial trouble for those buying a home in an HOA-governed community.
Other Problems with HOAs Are Commonplace
Rising costs are not the only issue reported for homeowners dealing with inflexible HOA committees and unfair CC&Rs. Some of the most common issues include the following:
- Inconsistent application of the rules outlined in the CC&Rs
- Ineffective enforcement of CC&Rs for serious or dangerous nuisances
- Failure to alert members of the HOA regarding special assessments and increases in fees
- Overly intrusive interventions into normal activities
- Failure on the part of the HOA to provide the agreed-upon services for residents
- Financial issues that may lead to foreclosure or sale of common areas within the community
Depending on the terms outlined in the CC&Rs, homeowners may have little or no recourse when faced with these problems. Consulting with a Sugar Land real estate law specialist can provide the expertise needed to protect legal rights and ensure the most positive outcomes possible for homeowners in the modern HOA environment.
Recourse for HOA Residents
The 2011 legislation passed in Texas is designed to provide added transparency for residents of HOAs by mandating that all records pertaining to meetings of these organizations be made available to the public. This can offer valuable protection for residents in these communities by providing them with advance warning of planned increases in fees and enforcement actions on the part of their HOA. If evidence exists that the HOA is not living up to its side of the bargain by providing valuable services at a reasonable price, residents may also be able to pursue legal action against these organizations with the assistance of an established firm specializing in Houston real estate law.
If you are interested in purchasing a home in Texas or are already living in an HOA, working with a Sugar Land real estate law firm can provide the answers needed to protect your legal rights and ensure the greatest degree of comfort in your home. Companies that offer Houston and Katy real estate law services can advise you of your legal rights and can offer representation both in and out of court when negotiating with your HOA. By enlisting the help of The Law Office of Henry Jakob, you can ensure the best outcomes for your complaints and the greatest protection against unfair claims and assessments by your homeowners association.