annuals doubled from 2006!

I live in NC in a pretty descent developement.when we had our house built 2 yrs ago were not told of any HOA there.After living there 1yr a managment company comes in and put HOA in effect saying it was there since 2000. I have looked over all my contracts and found nothing about HOA.So to be nice about itwe paidthedueslast year but this year they did a 100% raise on the dues! Is this legal and did he breech his contract? We didn't have any say so on the dues going up, no vote! TY

Are there any townhouses without an HOA? Who else will collect funds and maintain the common areas and any amenities if you have them?
Who is this management company? They have no authority and should serve at the pleasure of the board. Are you sure there is not a board of directors calling the shots?
As far as doubling the annual assessment, that is probably not allowed. If you had documents, they should spell out how much increase is allowed each year. And perhaps even your state has a law as to how much it can be raised in one year. (Arizona allows a max of 20% increase over the previous year unless your documents state a lower percent.) If more money than that is needed, they must request approval from the members for a special assessment.
Call this management company and requiest copies of your documents before you pay any more. Check all your purchase documents for what you agreed to. Good luck. Harold

thank you for the input Harold. I have a copy of coenants and it says that assessments can be raised effective January 1st of each year but subjectto the limitaion that any such increase shall not exceed the precentage increase, IF any, in the Consumer Price Index (published by the United States department of labor) US city average, for all cities over the emmediatley 12 preceding 12 month period which ended October 1st. The base period for the Consumer Price index is presently 1982-1984 =100. Do we still use the 1982-1984 CPI or 2006? TY

If the CPI increased 2.5% from last year then that is what your increase would be limited to without a vote if that is what your CCR's say. The cpi changes a certain percent from the base year each year. Sounds like they got a 'little' carried away.

PS now that you mentioned you have covenants it seem clear that you are part of a deed restricted subdivison that may just not have formed the HOA when you moved in.

TY DJ, I understand we have a HOA but the problem is they think they can raise dues 100%! I know they can raise them according to CPI but not 100% I looked it up on internet and I came up with 2.5% just as you did and they pretty much laughed at me and one of the board members got pretty ughly about it and came out from behind the board desk and started walking toward me then stopped after realizing he would get into trouble if he caused a fight! I don't mind one little bit paying my dues but when the board is made up of crooks what can I do! And besides that they said they could double again next year! to me they are just crooks making us ( the homeowners) look like dummis, fools! TY

AdolphusL:
When an HOA is established, the developer usually lowballs the assessment fee just to 'entice' buyers. It is normally always increased after that time.
However, an increase has to be justified.

Why not ask Mgmt. company for copies of past financial reports so you can see firsthand the reason for the increase. It is obvious that if expenses exceed the income, the expenses have to be raised to cover adequately--and even provide a little cushion.

You have no basis for retaliation until you actually know if the increase in fee is justified and in what area/s. Then you have a basis to work from.

Adolphus two questions; how much of an increase are you talking about? A 100% increase of $20.00 is different than 100% increase of $500.00. Also has your community transitioned from the developer? If the developer is still in control the cpi restriction may not apply yet.

They can't do that. Period. Get a group together and request a special meeting and vote those rascals out. Or file a lawsuit. If you can't afford to file a lawsuit, maybe your lawyer can write them a letter telling them what they are doing is illegal and could be taken to court. A letter shouldn't cost much and might do the trick. He should also mention their insurance would not cover them in a lawsuit because by this letter they are informed what they are doing is wrong, and if they continue they will be on their own to defend a lawsuit. The problem with some boards is that they know most homeowners cannot afford to sue them, so they think they can get away with whatever they want to do. Harold

As PaulM stated most Developers do set the dues low to entice Owners to purchase. Because he subs out the work and the subs bread & butter work is the Developer, he then gets a better rate in landscaping, insurance etc. When the board (HOA) gains control many times they have to raise the dues to pay the increase in their budget line items.

A misconception of many Owners is the HOA is established when the homeowners gain control. This is wrong, the HOA is established at the time of the Developer recording the Articles of Incorporation within the state. It sounds like it was recorded as the board said in 2000. Once the development is 75% sold it then transitions to the homeowners and the homeowners gain control over the HOA.

In NC the dues can only be raised in accordance with your CCR's. Some documents say 5%, I have seen in NC some have read even 10%. I would read that section carefully to determine how much could they raise it.