small HOA 5 units and under

Started by RoyY • 20 replies • 1609 views

💬 Join us to post & get advice from 50,000 HOA & Condo leaders.

⚡ Takes 30 seconds

Already a member? Log in

RoyY (Maryland)
Posts: 11

Posted:

The development of HOA for resale value with HOA fees above 1% of mortage.
How does one not enter into an HOA if one does not exist and can you be forced to join if there is currently no HOA in place?

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

If you purchased a home in a community where there is no HOA, I don't believe you can be forced to join an HOA if the property owners want to establish one at a later date. It's always been my opinion that you would need 100% agreement to form a mandatory HOA. But, I may be wrong. You may want to check the State HOA statutes or perhaps talk to an HOA attorney.

RoyY (Maryland)
Posts: 11

Posted:

can in some cases an HOA cause finacial hardship trying to sell a home?

SusanW1 (Michigan)
Posts: 5,202

Posted:

Any buyer should be told that there is an HOa, what the mission of the HOA is, and what are the dues. This person should also be aware of any financial dealings (ie. capital fund drives, accounts payable, insurance documents, reserve fund standing) that the HOA is involved in.

On the good side: A good HOA is a way to build community and to maintain property values, protect the owner's investment.

There should be Articels of Incoropration and bylaws. Be sure you get copies of both.

BrianB (California)
Posts: 2,820

Posted:

yes, it is possible that some buyers may look at an HOA as an added expense without value to them, thus reducing the value TO THAT BUYER.

Overall, whether an HOA adds, subtracts, or is neutral to a home value among the entire buying pool has much debate.

RoyY (Maryland)
Posts: 11

Posted:

Do you know if you can be forced to enter one if you wish not to. And how many home owner must participate in an HOA?

SusanW1 (Michigan)
Posts: 5,202

Posted:

Depends on the obligations of the HOA.

If there are common areas, roads,water stystem, beach, community center, pool,landscaping duties, parking lots, garbage pickup, etc. - then you can see that there are responsibilities of the HOA to safeguard and upkeep these common elements.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

You asked: how many members must participate? If it's a mandatory HOA, then all the property owners are automatically members of the HOA. They all must pay the assessments. There are no exceptions to this regarding a mandatory HOA.

If a voluntary HOA, then only those property owners who wish to belong can join and only those joining will be assessed a fee, if any.

RoyY (Maryland)
Posts: 11

Posted:

if I have owned this house for 20 years and a neihgbor wants to create an HOA how can I be forced since my deed only has a covedance?

GlenL (Ohio)
Posts: 5,491

Posted:

What is a "covedance" that is a term I am unfamiliar with and could not find it on line? If your property was never part of an HOA and someone starts one then you can't be forced to join. If however your property was originally part of an HOA which was allowed to go dormant for whatever reason and it is revived then yes they probably can force you into it. This is something you should ask an attorney that specializes in real estate in your area.

Studies show that 5 out of 4 people have problems with fractions

GlenL (Ohio)
Posts: 5,491

Posted:

Roy if you meant covenant then possibly yes you can be made to join.

Studies show that 5 out of 4 people have problems with fractions

RoyY (Maryland)
Posts: 11

Posted:

YES covenent sorry. I checked yesterday with our county and their is no HOA enforcement. Infact they don't even record HOA's in our County if one was created.

Whey or how can someone to be forced to particapate in an HOA?

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

Many deeds contain covenants but there is no HOA to enforce. Do you have a copy of the covenants? If so, it should be stated therein if there is an HOA to enforce the restrictions. If you don't have a copy, then ask the HOA board to provide a copy so you can determine if you are, in fact, a part of the HOA. The Co. may not record the covenants but I wouuld assume they do record the plat of a s/d. As a last-ditch effort to determine if you are a part of this HOA, you can look at the plat and see if your street number is on it.

As was mentioned earlier, the HOA may have been dormant for a number of years and now a group of homeowners have resurrected it, in which case, you would have no choice but to play by the rules of the CCRs (covenants).

RoyY (Maryland)
Posts: 11

Posted:

MaryA1,
When you say homeowners, do you mean the the neighbors in the developement or just a few people who may want to create the HOA. My personal opinion, if 20 people live in the delvelopment then wouldn't it be fair to say all homeowners should be part of the HOA? And any new homes within that delvelopment?

How about the HOA wants add building lots from another subdivision and add it too the HOA you are trying to create?.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

When I refer to homeowners I mean the homeowners in your community -- the homeowners who would be a part of this HOA. Yes, I would agree, all the homeowners living in the development should be members of the HOA. But, that only applies if the HOA is to be -- or is -- a mandatory HOA. THere are voluntary hoas too and only those living in the community who wish to join are members. If there are any costs involved to maintain common areas, etc, only those who belong are assessed. Because you mention adding building lots from another subdivision to this new HOA, I get the impression it would be a voluntary HOA. A mandatory HOA cannot just "annex" homes or lots from another s/d into their HOA. The developer creates the HOA before construction on the first lot even begins (at least that's how it's done in AZ). If more than one community is to be included in the HOA it is determined at that time. My HOA is comprised of about 8 - 10 different communities but that's how it was originally set up. Each community was built by a different home builder and they all got together to form the HOA.

Perhaps you can explain in more detail exactly what is being proposed regarding this new HOA.

RoyY (Maryland)
Posts: 11

Posted:

MaryA1
Its like this. I live on an private estate that has 3 homes (all family) In 1994 a subdivision was created from the 98 acres and subdivided into 49 building lots and 5 open spaces areas. Their was 20 acres around our homes designated as open space. We have maintained the (20 ac)open space among the 3 homes without the need of an HOA since 1998. The covenants has no mention of any HOA. period nor do any othe 49 home owner use the open space.

Recently one of the three owners past away and the house is being sold. It was thought in the best interest of the open space to create an HOA. Which was never an issue, until now, since the other house is going on the market in two/three years, that leaves only me. The second party wants to create this HOA to ensure that the property is maintained as is today for as long as possible while they are living here and hopefully to perserve the estate for years to come. What concerns me now, if I try to sell my home (5-10 years) the person who is interested in our home may not be able to afford the up-keep ($600-1200.00) per month. Plus we are not talking about a Million dollar home.

The other 2 lots in question to be part of the HOA border the open space from another 50 home subdivison. I have reviewed the land Plat, the declaration of covenants and find no mention of an HOA nor can the open space be deeded to an individual unless all parties agree. These two lots would benfit from the sale if the could use the open space and take part of the fees with the HOA.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

Your homestead sounds idyllic to me! My question is, why fix something that isn't broken. If it's worked all these years for the 3 homesteads why shouldn't it continue to work even if those homes are sold? I would say leave well enough alone and see what happens. Although I do live in an HOA and have no problems living this way nor do I have any problems with our BOD; if I had my choice I would much rather prefer to live on acreage like you w/o an HOA. I've been there and done that in the past and would give my eye teeth to do it again!! My advice: forget about an HOA unless it becomes absolutely necessary and is the only option to keeping this property in the condition that it's in now.

RoyY (Maryland)
Posts: 11

Posted:

Mary,

Whats happening now is one of the homesteaders whats to sell two lots outside the estate. Inorder for this homesteader to get the most amount of money for their lots they want to tear down a fence thats been there for 30 years allowing access to parks, ponds and pathways. I don't want to fight with them, but as you said, why change it if it not broke. The lots will still sell and creating an HOA only benifits the seller of these two lots which is right next to our house. So you can see why we don't want to grand access or tear down the fence or create an HOA allowing these to lots into our private world. It is a wonderful place and I've been here for 21 years. Now were being pushed to create an HOA and the homesteader has drawn a line in the sand after 20 years.

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

Is the fence on this "homesteader's" property?

RoyY (Maryland)
Posts: 11

Posted:

Mary,

Boundery survey stacks show homesteaders property behind fence. Also in the covetents (recorded 1998)it lists the developer (sold in 1994) as owner of fence which now is titled to the open space and it clearly spells out no maitance or erection of fences without permision
of any kind with out the developers approval first.

I don't beleive he would want to get in the middle between the two homesteaders since they sold him the land.

Do you still think the fence will stay?

MaryA1 (Arizona)
Posts: 7,043

Posted:

Roy,

Well, from what you say concerning the ownership, the developer should have the final say.

🎯 You've read this entire discussion

Join the conversation with 50,000 HOA & Condo Leaders:

✓ Ask follow-up questions
✓ Share your experience
✓ Get expert advice
✓ Access 350,000 discussions

Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in here