An amazingly ignorant story was posted by reporter Jeff Skrzypek of WPTV this month. It noted that Homeowner Associations in Florida were crippled by the housing crisis. He did have the class to acknowledge that developers were also impacted.
Then, the reporter interviewed whiny homeowners in Lake Worth, Florida who pay their dues each month but just don’t see the neighborhood improving because so many foreclosed homes are driving down prices, and those homes don’t contribute to maintainance of the common areas.
Besides, they complain, the developer can’t sell 9 of the 60 homes there, so he’s decided to rent them out instead of selling them and turning control of the HOA over to the residents.
The average thumb sucking dullard could figure a few things out, here. Housing prices have nose-dived in Homeowners Associations because home buyers are getting smart. They’re figuring out that the worst investment in the world is an HOA home where the dues aren’t being paid. Yes, the local swimming pool is covered with green grunge, but that won’t change until every home is occupied and all dues are being paid again. That could take years.
And that rotten developer! What if he just turned those homes over to the bank? That’s nine more foreclosures in a neighborhood that’s already going through its death throes. He’s actually keeping that housing development on life support, probably at enormous personal expense.
Then the idiot homeowner complained that she thought she was moving into an ownership community? Wake up and smell the coffee. Pass a state law that says no HOA resident is allowed to rent out his home. Then you’ll see how low housing prices really can go!
One more thing. Homes inside Homeowner Associations take a faster dive in value than any other kind of housing. So much for the promise of protecting the equity of your home.
I just had an idea. What if all those weepy homeowners quit talking to reporters and walked around the neighborhood voluntarily cleaning things up. Nah, come to think of it, that doesn’t happen in Homeowner Associations. They’ll wait until they can appoint a cleanup committee.
Ward Lucas
Author of
Neighbors At War: The Creepy Case Against Your Homeowners Association
“Pass a state law that says no HOA resident is allowed to rent out his home.”
I was listening to a 2005 interview with Lincoln Cummings, one of the co-founders and a past-president of the Community Associations Institute (C.A.I.), the H.O.A. trade and lobby organization.
http://onthecommons.us/index.php?option=com_content&task=view&id=114&Itemid=67
http://onthecommons.us/images/stories/shows/20050409cummings.mp3 ( 9 MB )
At about 50 minutes 20 seconds into program, host Shu Bartholomew asked him if he lived in an H.O.A.
He responded that he owns 3 properties in H.O.A.s, but doesn’t live in one himself.
Also, my H.O.A.’s President and Treasurer are non-resident investment owners. But it didn’t stop them from trying to prohibit other people from renting their units out.
Politicians favor investment-owners. Republican presidential candidate Mitt Romney’s solution to the housing crisis is to “don’t try and stop the foreclosure process. Let it run its course and hit the bottom, allow investors to buy homes, put renters in them” (from Evan McKenzie’s blog at http://privatopia.blogspot.com/2011/10/romneys-foreclosure-plan-faster.html ).
Given that the rate of home ownership is declining (for several reasons), the push by H.O.A.s to restrict renters — which didn’t even make sense when the housing market was doing well — is doomed to failure. Anybody who thinks they’re going to live in a “community of owners”, when the demographic, economic, and political trends favors non-resident investors, is clueless about what is going on.