Amending CC&R's Rental Rules

Started by AndersH • 7 replies • 2186 views

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AndersH (Arizona)
Posts: 30

Posted:

We are an Arizona condo community of 108 units. Our CC&R's states "No unit may be leased for a period of less than seven (7) days". Our BOD wants as advised by their attorney to amend the CC&R's to:
1. Eliminate the 7 days limit.
2. Adding "The Board of Directors can create amend or appeal rental rules including rental periods from time to time at their discretion".

A ballot has been sent out to the membership hoping to get 67% of the votes. Many of us feel this is the wrong direction to go. The BOD wants a longer minimum rental time and they think that by giving them free hand to change the rental rules, they will accomplish this.

I think this is a bad idea and we may in the process loose the 7 day minimum in the CC&R's. Also, giving a BOD the power to change the rental rules anytime they feel is bad for the lender, the none-rental owner and the rental owner. My advice to the BOD was to try to change the CC&R's for a longer minimum rental period but to keep the board out of being able to change the rental rules (if it is even possible at all).

Any opinion and advice on this would be appreciated.

Anders

TimB4 (Tennessee)
Posts: 21,062

Posted:

I agree that rental restrictions should not be at the whim by boards. You need to remember that even if this board is great, a future board might not be. Since proxies are not allowed in AZ, you need to get your concern to the membership.

I would recommend a flyer to each member. Request a copy of the membership roster so you can send the flyer to non resident members as well. Since ballots have been sent, you need to move quickly on this.

Something like:

The Board is requesting to change the covenants and give them the power to address rental rules. If adopted, this would allow this or any future board to:

1) set minimum rental lengths
2) completely prohibit rentals of any length
3) set maximum rental lengths
4) disallow rentals for the first 2 years of ownership (or any other length of time)
5) require association approval of the lease and lessee
6) require background checks of rental occupants
7) and anything else the current or a future board might think of.

I don't think this board or any future board (whomever they might be) should have this authority. If the board desires rental restrictions then those restrictions should be set by the membership and x people who represent a majority.

Just as we don't know who will be serving on the board 10 years from now, you can't be sure you won't want or be required to rent in the future. Please keep this in mind as you cast your vote for this amendment and keep options for you and your family open.

VOTE NO
TO AMEND THE RENTAL RESTRICTIONS
IN THE DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS

For further information contact name, phone, e-mail

MelissaP1 (Alabama)
Posts: 13,836

Posted:

It isn't what the HOA wants in regards to rental restrictions it is up to the MORTGAGE companies. The mortgage company's are responsible for the rental restrictions NOT a HOA. If the HOA wants to offer the best mortgage options to potential buyers they must meet certain requirements and conditions. A mortgage company will deny offering certain loan packages to customers based on the health and conditions of the HOA. There is a HUD form that FHA submits to the HOA to fill out when they close on a their loans. It has 25 questions on it. That is where the rental amounts and how many people owe shows up anywhere.

Former HOA President

RogerB (Colorado)
Posts: 5,067

Posted:

AndersH, I would amend only to a specified time period,i.e.,"a minimum of 14 days".
Did you check with an attorney as to whether or not your proposed wording would hold up in Court?

AndersH (Arizona)
Posts: 30

Posted:

Thanks for your replies. In regards to checking with an attorney, our attorney actually wrote the proposed amendment. I question very much that the proposed amendment would hold up in Court. Also, I question if the board can be allowed to change the rental rules unless the proposed changes are supported by the CC&R's?

I hope someone has more answers to this.
Thanks again,
Anders

JanetB2 (Colorado)
Posts: 4,219

Posted:

Hi Anders:

I agree with Tim as I would not give control to the Board. If the members vote to Amend the CCR’s and allow the changes proposed by the attorney then the Board would be able to change the requirements at any time without the homeowner’s consent.

If agreed and voted by the members, the CCR’s are properly Amended, and filed with the local County Records more than likely it potentially would hold up in a court of law, because the members gave their OK to allowing the situation and board authority.

If it was me I would be knocking on all neighbors doors or leaving a rolled up flyer about the situation rubber banded to their door knob. If you have out of town owners I would send them a letter or give them a telephone call.

The answer to this situation is to get majority of your community to say NO.

CarolR11 (Colorado)
Posts: 2,563

Posted:

I agree entirely with Tim & Janet. You do NOT want the current/a future Board to have that kind of power.

SteveM9 (Massachusetts)
Posts: 3,699

Posted:

I feel differently. If people want to rent out their house, even for 7 days they should be able to. They own it, pay the taxes, etc. I know some condo owners who make so much money renting their beachfront condos by the week, they move out in the summer and rent a house for themselves.

When you start making rules for what people do "inside" their homes, I disagree with it.

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