Tag Archives: Realtor

Indiana Residents Fighting Eminent Domain for Private Development

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guest blog by Deborah Goonan

I follow Institute for Justice on social media. See the link below for their recent press release about the Pleasant Ridge neighborhood of Charlestown, Indiana. This is yet another case where the city seeks to declare several city blocks “blighted” and to use state grant money to purchase 350+ homes for the paltry sum of $6000 each.

According to a June television report (link below), which includes interviews with Pleasant Ridge residents and Charlestown Mayor Bob Hall, early plans for development are to create a mixed use neighborhood consisting of duplexes, single family homes and affordable housing for seniors. In other words, probably another HOA, this one subsidized by tax dollars.

In June, Hall was quoted as saying that owners would not be “low-balled” on prices offered for their properties. At that time, Hall said owners would only be offered up to $15,000 from grant funds, and developers would have to contribute the rest toward market value. So the proposed offer price has already dropped by $9,000 in just 5 months, with no mention of Developer contribution.

The bottom line is that private developers want the land, so they can build new properties. The Mayor wants to collect higher tax revenues. Instead of dealing with individual properties that are in need of being condemned or demolished, the plan is to raze the entire neighborhood and displace hundreds of residents. Once again, the Supreme Court’s twisted definition of “public use” comes back to haunt American citizens. Fortunately, Indiana’s laws stipulate that eminent domain cannot be used for private development.

I find the following statement from the Mayor’s office particularly interesting,

“This area was declared blighted in 2002 in connection with a revitalization grant received then. The housing in this area was temporary housing bought by the army to house workers at the ammunition plant in 1940,” the mayor’s spokeswoman, Geneva Adams, said.  “They were not meant to be permanent housing. The decline of these structures is evident as you drive through the area.”

Has Ms. Adams taken a close look at the construction quality of many modern homes? I would be willing to bet that the majority of them will not stand the test of time as well as the Army’s temporary housing that is now 74 years old.

(link to Institute for Justice news release)

(WLKY-News video of Pleasant Ridge and Charlestown Mayor, June 2014)

(WDRB coverage from earlier this year)

Dumber Than Dirt In Delaware

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The Maple Hill Homeowners Association is becoming the laughingstock of Bear, Delaware. There are only 23 homes in this HOA, but these idiots have picked the most unbelievable fights with each other and have made their own neighborhood toxic to anyone thinking of buying a home there.

Dues are cheap. About $280 a year. But the petty bickering and the downright nastiness has churned up more than $45,000 in legal fees as various neighborhood crybabies run to the courts to try to get their problems solved.

Ken and Joanne Holbert have tried for years to pay their homeowners association dues by sending checks to the HOA’s mailbox. The president, Jutta Douglas, refused to accept the certified mail in a patently obvious effort to slander the couple with terms like “deadbeat” and “freeloader.” Those actually are actionable terms and the Holberts could probably win a good-sized slander lawsuit.

The numb-skulls at Maple Hill then filed liens against the Holberts’ home. Under Delaware law, you don’t even have to notify a homeowner that a lien has been filed. Just file and foreclose. It’s mean. It’s vulgar. It’s the kind of thing that’s led to violence in a number of other states.

A couple of Delaware politicians are talking about creating an Ombudsman’s Office to deal with petty strife like the viciousness in Maple Hill.

You can fix a law. You can change the way that some HOAs operate.

But you just can’t fix stupid.

(HOA disputes in Delaware)

 

Balance of Power in U.S. Senate Based On HOA Chickens?!?

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Some stories are just too weird to embellish, even for the sake of humor. But the U.S. Senate seat from Iowa may boil down to a neighborhood dispute over chickens.

Democratic Congressman Bruce Braley is running for Senate in a razor thin race. Braley has a vacation home in the ritzy Holiday Lake neighborhood in Brooklyn, Iowa. Covenants in the neighborhood say, “No animals or birds other than household pets can be kept in the subdivision.” But one of Braley’s neighbors (also a registered Democrat) keeps chickens on her property as ‘therapy animals’ for mentally handicapped youngsters.

The chickens apparently strayed into the Braley’s yard and litigation was threatened. The owner of the chickens tried to make amends with a gift of eggs, but the Braleys wouldn’t have any part of that.

Now, there’s a hot new Iowa Republican attack ad with some talking chickens making fun of Braley’s threatened lawsuit. You can read the rest of the details at the links below, but the story is just too ridiculous for words.

If the balance of power in the U.S. Senate shifts in this election, finally, FINALLY folks in Congress might start talking about the idiocy and meanness of neighborhood disputes in Homeowners Associations.

(talking chickens ad)

(washington post take on the chicken dispute)

 

Nevada ‘Mouth’ Moves Again

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Ah, Barbara Holland, how we love thee! Ms. Holland, who writes a column in the real estate section of the Las Vegas Review-Journal, complains about a recent guest blog that lists some of the complaints against her: One is that she gets paid for writing her newspaper column which is massively biased in favor of Homeowners Associations.

Ms. Holland, who describes herself as the “Dear Abby of Homeowners Associations,” will never deny that writing her newspaper column has made her very rich in the real estate business. Her ‘voluntary newspaper column’ is the kind of self-promotion that every entrepreneur dreams of. Whether she gets paid ten or twenty bucks per column by the newspaper is absolutely immaterial. Barbie Baby, you started piling up your millions in the property management and Realty business the day your first column was published. In the most corrupt real estate market in the nation, most honorable people would be scared to death to identify themselves as being the “Dear Abby” or “Dear Ann Landers” of anything HOA related.

But all of that is petty infighting and beyond the point. The issue at hand is the stupidity and short-term thinking of the Nevada Supreme Court which ruled that an HOA’s Super-Priority lien could extinguish the mortgage company’s first deed of trust. Bottom line: thousands of Nevada homes that are in crisis can be snatched up by real estate bottom feeders who grab homes for a couple thousand bucks at auction, and flip them for hundreds of thousands of dollars each. A windfall profit. A disaster for those in the mortgage business. And Barbie tells us, “No big deal.”

In fairness to Barbie Baby, here’s her latest take on the subject:

(link to Barbara Holland’s column on Nevada court decision)

Now that “Dear Nevada Abby” has spoken, let’s look at some totally different conclusions made by far more astute financial folks at the Wall Street Journal, reporters like Joe Light (joe.light@wsj.com). The link below sometimes asks for a registration, but any good Internet researcher can find a way around that.

(link to WSJ article on Nevada mortgage mess)

(link to parallel article in Bloomberg News)

Now, to you, Dear Reader. Do we believe in dear ‘Self-Interest Nevada Abby?’ Or the financial folks on the national scene who are actually talking to the nation’s lending institutions about all the impending consequences?

 

 

 

 

Should There Be Federal Standards & Regulations For HOAs?

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guest blog by Deborah Goonan

My colleagues and I have posed this question on several occasions in HOA discussion forums frequented by Community Associations Institute (CAI) members – mostly community managers and attorneys, with an occasional Board member.

Of course, the knee-jerk HOA industry reply is “NOOOOO!” The standard mantra is that HOAs do not want or need more government control. Why would Association members want some bureaucrats in far-off Washington DC telling communities how they ought to govern themselves? They reason that members of HOAs are quite capable of choosing their own destinies, within their own “form of democracy.”

In theory, perhaps. In reality, perhaps not.

I find it curious that, while HOA cheerleaders abhor government interference in any form, they see nothing wrong about the excessive and often petty interference of HOAs over the property and lives of its owners and residents.
Typical HOA-manager/attorney/developer reasoning is along these lines, “We all know how very important it is to establish rules about what you can put in a flowerpot, how long your dog’s leash can be, where your children are NOT allowed to play, and what colors are acceptable for your front door. For these types of decisions, you, American HOA resident, are incapable of clear thinking and sound judgment. Therefore, the developer’s attorneys have crafted a legal contract detailing every aspect of your limited rights to dwell in your HOA, subject to swift and sure penalty should you fail to conform.” In practice, you may be subject to swift and sure penalty simply in order to keep you in line.

For the official party line on government regulation of HOAs, see page 47 of CAI’s Public Policies (emphasis added in italics):

“Community Associations Institute supports effective state legislation–when it is deemed necessary for consumer protection, conversion limitations, protections for ongoing operations or other additions to existing statutes or common law to ensure that community association housing is developed and maintained consistent with legitimate public policy objectives and standards that protect individual consumers, balancing the legitimate rights of the development industry.

Local legislation concerning the creation or governance of community associations is antithetical to a balanced, well-considered assessment of all issues and interests affecting community associations. It also encourages a patchwork of regulations within an individual state and is, therefore, better dealt with at the state level.”

According to CAI, if you live in an HOA, your legitimate rights are secondary to the rights of the corporate HOA – which is, in fact, the creation of a Developer.

Read this policy between the lines: municipal level legislation would make the HOA’s job too inconvenient, potentially limiting where and how HOAs can be built. However, at the state level, developers can pretty much call the shots to “balance” their legitimate rights.

And how does CAI justify its encouragement of “a patchwork of regulations” within the US, on a state-by-state basis, when their own public policy strongly discourages differing regulations within each state? That stance defies logic. Why is it that owners and residents find vastly different HOA laws in each state? The HOA industry lacks federal consumer protection standards that exist for virtually ever other major market sector in America.

What makes the HOA (i.e. Development) industry so special, that it should be deserving of less scrutiny and oversight than, for example, insurance, banking and financial services, healthcare, or public and private education?

By now it’s old news: HOAs are obviously vulnerable to financial mismanagement, corruption, and white-collar crime. Money crosses state lines and with over 65 million taxpaying residents nationwide, these issues certainly rise to the level of general public interest.

Therefore, there most certainly is a need for federal level legislation and regulation of HOAs.

(link to CAI Public Policy)