Homeowners association

Some of the developments that real estate developers build are common interest developments, a category that includes planned–unit developments of single–family houses, condominiums, and cooperative apartments. Before the first unit is sold, of one of these developments, the developer records restrictive covenants — on all of the properties — that "run with the land," meaning that all successive buyers are bound by the same covenants as the original purchaser. These covenants, among other things, form a homeowners association.

Related Topics:
Developments - Condominium - Cooperative apartments - Restrictive covenant

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A homeowners association is an organization comprised of all owners of units in the development. The vast majority of them are incorporated and are therefore governed by a board, which is a private government.

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Homeowners associations collect fees, fines, and assesments from homeowners, maintain the common areas of the development, and enforce the association's governing documents. These may include detailed rules regarding construction and maintenance of individual homes.

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Often, a homeowners association has to collect special assesments, in addition to the set fees, from all the members. Asssments can be to cover legal expenses for a judgement against the homeowner's association, to repair damage from a natural disaster, or to make improvements.

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In some states, California for instance, a Homeowners Association can sell a member's house without any judicial procedure in order to collect a fine. Other states, like Florida, require a judicial hearing.

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Some of the responsibilities that the covenants delegate to homeowners association boards would otherwise be performed by local governments.

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Nevertheless, only owners -- who need not be residents -- are allowed to vote in elections to choose the board. Residents of the community who are not owners (e.g., renters) are disenfranchised.

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Homeowners associations are increasingly common in the United States, exercising control over 19% of American homes, 20 million homes.

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