SarahB7 (Washington)
Posts: 5
Posts: 5
Posted:
One of our units was sold about 9 months ago to a couple who proclaimed their intent to occupy it themselves or to let their son live there. They were told in no uncertain terms that our rental cap was met and that they could sign on to the rental waiting list if they had plans to rent it in the future. A couple of months went by with the unit unoccupied, and then one day a completely strange couple moved in, telling neighbors that they were either "friends of the family" or owners of an unstated percent of the property. When requested to furnish proof of this ownership, the main owner, who had bought the place under an LLC, was hostile, threatening to "take action" against whoever the inquiring individuals might be. Informed that the Board had a legal right to request such documents, the main owner finally provided the paperwork.
The original buyers had obviously studied our Declarations/CC & Rs and figured out a way to rent the unit under the counter. The current occupants are, according to the LLC, 1% owners. According to the "Residential Occupancy Agreement" we received from the buyers, these individuals have been appointed "on-site managers," for which they receive compensation of $200 deducted from the "occupancy fee" they pay for the privilege of living there; the amount of this "occupancy fee" is equivalent to what our actual, legitimate renters pay. We had the documents reviewed by an attorney, who found that the arrangement was not in violation of the Declarations, since the occupants are technically owners, even at 1%.
The Board is currently moving forward to revise the language of the Declarations in order to close the loophole and ensure that no one else can get through it. Currently, the language in the Declarations notes that this section (On rentals and restrictions) "applies to the occupancy of any Unit by a person other than its Owner, including occupancy by tenants, assignees, and subtenants," excluding only "guests, family members or care givers who share occupancy with the Owner." Nowhere in the Declarations is there any language that approves an "occupancy fee," which is just rent by another name, as far as we can tell.
We would appreciate hearing from HOA members who have experienced similar situations, or who might have good advice about how we should word the revision of that verbiage on ownership and rentals. We realize that revising the language is only the first step, and that in order to legally amend the document we need to have a vote. But meanwhile, it would be great to hear from other HOAs. Thanks!
The original buyers had obviously studied our Declarations/CC & Rs and figured out a way to rent the unit under the counter. The current occupants are, according to the LLC, 1% owners. According to the "Residential Occupancy Agreement" we received from the buyers, these individuals have been appointed "on-site managers," for which they receive compensation of $200 deducted from the "occupancy fee" they pay for the privilege of living there; the amount of this "occupancy fee" is equivalent to what our actual, legitimate renters pay. We had the documents reviewed by an attorney, who found that the arrangement was not in violation of the Declarations, since the occupants are technically owners, even at 1%.
The Board is currently moving forward to revise the language of the Declarations in order to close the loophole and ensure that no one else can get through it. Currently, the language in the Declarations notes that this section (On rentals and restrictions) "applies to the occupancy of any Unit by a person other than its Owner, including occupancy by tenants, assignees, and subtenants," excluding only "guests, family members or care givers who share occupancy with the Owner." Nowhere in the Declarations is there any language that approves an "occupancy fee," which is just rent by another name, as far as we can tell.
We would appreciate hearing from HOA members who have experienced similar situations, or who might have good advice about how we should word the revision of that verbiage on ownership and rentals. We realize that revising the language is only the first step, and that in order to legally amend the document we need to have a vote. But meanwhile, it would be great to hear from other HOAs. Thanks!