How Does A Homeowners Association Affect Rental Agreements?

Homeowners Association

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Love them or hate them, homeowners associations are a HUGE part of life for property owners and renters because most condo and town home communities are part of HOA’s as are many new home communities which are being developed across the United States.

States like Nevada have extremely strict HOA laws….basically, HOAs are like God in those states, with the ability to have their liens and fines, trump first lien position mortgages and so much more.

Arizona and California are a little more measured however, but HOA’s still have a lot of power in these states.

How Do Homeowners Associations Affect Tenants?

The HOA has governing documents and rules that allow for all types of restrictions on the way you must live in their community.

  • Landscaping
  • Exterior displays
  • Exterior condition
  • Lights
  • Pets
  • Move-in times and dates
  • Parking, including use of your driveway and garage
  • Guest use of community facility
  • Speeding

HOA’s also have the power to enforce fines on the property; whether you agree or not. Though HOA’s usually have to provide the occupant with a written notice (basically a warning letter) first, once that is done they can both fine and hire contractors to make the appropriate corrections.

Now the fines are normally levied directly on the homeowner, and not the Tenant. But this is a mere formality as most leases, and more importantly, verbal occupancy agreements, support the rights of Landlords to push these fines, plus administrative fees, back to the Tenant.

A Tenant that doesn’t pay these fines and fees can be given the notice to cure and then evicted.

Usually, an HOA board will hold hearings for HOA violations or infractions. However, many HOA’s do not allow the Tenant to speak during such hearings; only the property owner may address the board.

How Do Homeowner Associations Work With Landlords?

Landlords must send a Tenant a copy of the Rules and Regulations at the time of lease signing. Once this is done, the Tenant has the right to review and can potentially cancel their lease if they find things that may not be conducive to their living situation. Some examples would pet restrictions (size or breed) as well as parking restrictions (no work trucks allowed parked on the street or driveway). But once the Tenant takes possession of the property, they are beholden to the oversite of the HOA.

Landlords should use an electronic copy and when relevant, have the Tenant sign an acknowledgement that they received a copy of the CC&Rs. Electronic copies may cost a few dollars to purchase from the HOA management company, but they can be utilized over and over again without worrying about damage or loss that accompanies a paper packet.

HOA’s can be a Tenant and Landlord’s best friend, or a rental nightmare. If you know the facts and proper procedures, then you can protect yourself from a lot of wasted time, energy and money.

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