How Homeowner Associations Work?

Date: 2011.12.04 | Category: Company | Tags: HOA,HOA Function

A homeowners association (HOA) is typically a nonprofit corporation with articles of incorporation that define the association’s purpose and powers. These articles of incorporation are filed with the state. The members of an HOA elect a board of directors to govern the affairs of the project subject to its bylaws, which contain the basic governing rules by which it operates.

They lay out how the HOA functions, including how meetings are conducted, voting is handled, board members are selected, and assessments are determined. Ideally, the community is run like a small city government, with elected board members representing the will of the owners.

Federal laws as well as local ordinances, zoning, building codes, parking, traffic restrictions, resale regulations, and rent control provisions apply to HOAs. Another layer of restrictions are called CC&Rs, which stands for covenants, conditions, and restrictions.

Created by developers when they plan a condo or townhouse community and get it approved by the local planning board, and recorded in the county recorder’s office along with lot plans, CC&Rs are rules that govern what you can and can’t do with your property.

Common restrictions invoked to attempt to maintain the value and theme of the community involve landscaping, building additions, exterior colors, and whether you can park an RV in your driveway. Most developers put a lot of thought into what restrictions they put in their CC&Rs.

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