New rules for owners who rent their homes

JackB5 (California)
Posts: 2

Posted:

We recently introduced a new rule to our CC&Rs limiting
rentals to 7% of homes that can be rented at any one time
and in order to rent at all you had to own the home at least
two years, existing home owners are exempted.
One or two of our owners took exception to this. This rule
was voted on by our Association and it passed about10 months
ago.
He sent us notice that he was bringing in a HUD lawyer and
that the rule, is according to him was illegal.
where does the Association stand on this.

Jack b5

JanetB2 (Colorado)
Posts: 4,219

Posted:

Hi Jack:

Here is a Davis-Sterling page regarding this issue:
http://www.davis-stirling.com/MainIndex/RentalRestrictions/tabid/1322/Default.aspx

You might review this along with the case law links to insure your documents contain proper information for the rental restrictions. The important issue they stress here is the "reasonableness of the restrictions".

Here are a few items to consider from what I remember being discussed on this site before regarding rentals:

1. How is it determined who is part of the 7% that can be rented. Be careful that there can be no discrimination claims regarding who is being allowed to rent. This has been discussed on this site before from a different state and if I remember the ones renting were primarily board members, and someone was potentially claiming discrimination.

2. It has been suggested before on this site to eliminate potential discrimination and to allow all homeowners equal opportunity to rent in case of emergency, to restrict all rentals where everyone can rent their unit for only 9 months out of every 12 months.

3. In today's economy many individuals are having to rent their homes or face forclosure. So, a question previously posed is do you want to allow renting and ability to still collect HOA fees, or not allow rentals and have homeowners possibly loose their homes and HOA unable to collect past due fees.

Hope this helps you ...