DavidS74 (Indiana)
Posts: 2
Posts: 2
Posted:
Has anyone had experience in limiting HOA rentals in Indiana?
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Limiting Rentals in Indiana
Started by DavidS74 • 5 replies • 1992 views
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DavidS74 (Indiana)
Posts: 2
Posts: 2
Posted:
I should clarify by clarifying limiting or not allowing homes to be rented in the HOA.
SheliaH (Indiana)
Posts: 6,964
Posts: 6,964
Posted:
There was a story in the Indianapolis Star last year about various communities in Central Indiana looking to adopt rental caps because there are large national organizations that are buying up a number of homes and renting them out - I think Greenwood was one of the cities mentioned where some of the HOAs did this. If you have a property management company, you may want to see if any of his/her client communities have them and provide your contact information to their boards so you can discuss how well it's working.
Look around this website and you'll see pros and cons to the issue, so it's not unique to Indiana - although it may be more of an issue here because this state has a high number of delinquencies and homes are fairly cheap compared to other parts of the country. Our community tried to get homeowners to agree to a rental cap of 20% because we were having (and still have) issues with tenants who weren't educated on community rules, a lack of community volunteers because most of the homeowners lived off site (some out of state) and we had some homeowners who were delinquent on assessments yet continued to rent out the houses.
And that's the primary problem with rentals in HOA communities. It may be tempting to push for an outright ban, but enforcing it would take a lot of work. And what if you have a homeowner who moves out of state and has to rent the place out to pay the bills (like the HOA assessments) until the house is sold? Rental bans may also run up against discrimination issues - for example, did the community issue a rental ban because it wants to keep out people of color, single parent households or folks on Section 8? On the other hand, what about the owner-occupants who may want to sell but a prospective buyer runs into trouble because mortgage companies are beginning to balk at underwriting mortgages in communities with too many rentals?
Look around this website and you'll see pros and cons to the issue, so it's not unique to Indiana - although it may be more of an issue here because this state has a high number of delinquencies and homes are fairly cheap compared to other parts of the country. Our community tried to get homeowners to agree to a rental cap of 20% because we were having (and still have) issues with tenants who weren't educated on community rules, a lack of community volunteers because most of the homeowners lived off site (some out of state) and we had some homeowners who were delinquent on assessments yet continued to rent out the houses.
And that's the primary problem with rentals in HOA communities. It may be tempting to push for an outright ban, but enforcing it would take a lot of work. And what if you have a homeowner who moves out of state and has to rent the place out to pay the bills (like the HOA assessments) until the house is sold? Rental bans may also run up against discrimination issues - for example, did the community issue a rental ban because it wants to keep out people of color, single parent households or folks on Section 8? On the other hand, what about the owner-occupants who may want to sell but a prospective buyer runs into trouble because mortgage companies are beginning to balk at underwriting mortgages in communities with too many rentals?
If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
JohnB26 (South Carolina)
Posts: 1,001
Posts: 1,001
Posted:
... because we were having (and still have) issues with tenants who weren't educated on community rules...quote]
So, take action against the member/owner ... a renter has NO obligation to the HOA ... the member/owner still does.
Volunteers are a nice EXTRA, but the association should be fully funded to operate without. If you can not form a BOD then receivership would be in order.
Petition a court for an injunction to have tenant pay dues from rent as the member/owner is now operating a business - this WILL get the owners attention due to IRS mortgage, income, licensing, etc.
GET TOUGH - TAKE ACTION - YOU ARE A CORPORATION
Renters are NOT the issue, lackadaisical landlords are the issue.
So, take action against the member/owner ... a renter has NO obligation to the HOA ... the member/owner still does.
... a lack of community volunteers because most of the homeowners lived off site ...
Volunteers are a nice EXTRA, but the association should be fully funded to operate without. If you can not form a BOD then receivership would be in order.
... we had some homeowners who were delinquent on assessments yet continued to rent out the houses. ...
Petition a court for an injunction to have tenant pay dues from rent as the member/owner is now operating a business - this WILL get the owners attention due to IRS mortgage, income, licensing, etc.
GET TOUGH - TAKE ACTION - YOU ARE A CORPORATION
Renters are NOT the issue, lackadaisical landlords are the issue.
JohnB26 (South Carolina)
Posts: 1,001
Posts: 1,001
Posted:
oops, no edit feature:
So, take action against the member/owner ... a renter has NO obligation to the HOA ... the member/owner still does.
Volunteers are a nice EXTRA, but the association should be fully funded to operate without. If you can not form a BOD then receivership would be in order.
Petition a court for an injunction to have tenant pay dues from rent as the member/owner is now operating a business - this WILL get the owners attention due to IRS mortgage, income, licensing, etc.
GET TOUGH - TAKE ACTION - YOU ARE A CORPORATION
Renters are NOT the issue, lackadaisical landlords are the issue.
... because we were having (and still have) issues with tenants who weren't educated on community rules...
So, take action against the member/owner ... a renter has NO obligation to the HOA ... the member/owner still does.
... a lack of community volunteers because most of the homeowners lived off site ...
Volunteers are a nice EXTRA, but the association should be fully funded to operate without. If you can not form a BOD then receivership would be in order.
... we had some homeowners who were delinquent on assessments yet continued to rent out the houses. ...
Petition a court for an injunction to have tenant pay dues from rent as the member/owner is now operating a business - this WILL get the owners attention due to IRS mortgage, income, licensing, etc.
GET TOUGH - TAKE ACTION - YOU ARE A CORPORATION
Renters are NOT the issue, lackadaisical landlords are the issue.
SheliaH (Indiana)
Posts: 6,964
Posts: 6,964
Posted:
Correct on all points - and enforcing rules against the owner makes the difference between a well run community and one where things go to ish. Crappy owners are bad enough, but when you have crappy owners who bring in hellspawn tenants for the sake of a buck, it's intolerable.
. We have sent violation letters to the homeowners and most of the time it is effective - especially when the tenants start stiffing THEM for rent, they spend more money to evict them and a little more because the tenants often trash the place on their way out.
We've also gone to court to get permission to collect rent from the tenant to apply against delinquent homeowners, but the main problem there is that in this state, some sort of form is then sent to the tenant which he/she has to sign so the court can collect the payments and if they don't sign or refuse to, we're back to square one.
As for volunteers, well, we need two spots filled on the board, but do have enough people to get things done. Three of them volunteered after I wrote a very strongly worded article in the newsletter about receivership (we were down to three members for a seven member board at the time). I'm off the board now, but still help with the newsletter - and I may well bring out receivership again if we don't get to full strength and the current ones begin to show signs of burnout.
. We have sent violation letters to the homeowners and most of the time it is effective - especially when the tenants start stiffing THEM for rent, they spend more money to evict them and a little more because the tenants often trash the place on their way out.
We've also gone to court to get permission to collect rent from the tenant to apply against delinquent homeowners, but the main problem there is that in this state, some sort of form is then sent to the tenant which he/she has to sign so the court can collect the payments and if they don't sign or refuse to, we're back to square one.
As for volunteers, well, we need two spots filled on the board, but do have enough people to get things done. Three of them volunteered after I wrote a very strongly worded article in the newsletter about receivership (we were down to three members for a seven member board at the time). I'm off the board now, but still help with the newsletter - and I may well bring out receivership again if we don't get to full strength and the current ones begin to show signs of burnout.
If it is not right do not do it; if it is not true do not say it. Marcus Aurelius
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