Owning Rentals in a Homeowners Association Community
When you belong to a Homeowners Association (HOA), the monthly fees help to go towards maintenance of the neighborhood and property values. With this in mind, HOA communities can be quite convenient, depending on where you live and what services are covered by your monthly HOA fee. However, operating rentals that fall under the umbrella of HOA authority can be difficult. But, reviewing the following steps can make the process a little easier.
What is an HOA?
Buying a property that falls under an HOA can be done for a variety of reasons. Some people may choose to purchase homes in such areas to ensure that their investment will be safe. HOAs work to help to keep the community safe and well maintained. Further, HOAs work to keep a sense of cohesiveness within the community through limiting short term residents. As a result, rentals within these communities can help to bring about the feeling of being a member of the neighborhood. Indeed, this feeling may be exactly what some tenants are looking for when looking for a new place to call home.
Rental Restrictions of Homeowners Associations
Although it can vary, depending on the community, there are two main types of restrictions that HOAs may impose. Cap limits outline the number of homes that fall under the restrictions of the HOA that can be rentals at any particular time. The other type of restriction pertains to the terms of the lease of the rentals, if the community allows for rental properties. These types of lease restrictions outline the minimum term of a lease. Lease term limits work to reduce the rate of tenant turnover and vacation rentals within the community. Being that rules and restrictions can change over time, make sure you monitor any changes to the HOA rules and restrictions. Regulations that were in place at the time you purchased your property may not be in line with what the most current version outlines.
Renting in an HOA Community
You’ve been given the green light to go ahead and place your HOA covered property on the rental market. Now what? When potential tenants come and view your property, give them a heads up about the rules and regulations adopted by the HOA. Hence, you should disclose any HOA regulations prior to the signing of the lease. After you have identified a qualified tenant for your property, provide a written list of the rules and regulations outlined by the HOA for your property. This helps to ensure that your tenants are aware of what is expected of them in order to live in harmony within the community.
Conclusion
Filling the role of a landlord is one that can be rewarding, yet quite stressful. Managing rentals can be a job in and of itself. Keeping up to date with the rules and regulations of your city and state codes can be a daunting task. Add in the rules adopted by your HOA regarding rentals and it can be even more challenging to operate as your own property manager. Given these points, turning to the professionals may be necessary. Fortunately, companies such as The Property Manager, are here to help you to navigate the confusing rules. Hiring a professional can allow you to unload some of the stress that can accompany being a landlord. If you need help managing your HOA property, contact The Property Manager to see how they can help!
References
Educational Community for Homeowners. (n.d.). HOA Rental Restrictions Laws and Best Practices. Retrieved from https://www.echo-ca.org/article/hoa-rental-restrictions-laws-and-best-practices
The Hignell Companies. (n.d.). How to Avoid Being Responsible for Your Renters HOA Rules Violations. Retrieved from https://blog.hignell.com/hoa-management/responsible-for-renters-hoa-rules-violations
HOA Management. (2013, August 22). What is an HOA? Retrieved from http://www.hoamanagement.com/what-is-an-hoa/
Homeowners Protection Bureau, LLC. (2018, July 23). The Do’s and Don’ts of HOA Rental Restrictions. Retrieved from https://www.hopb.co/blog/the-dos-and-donts-of-hoa-rental-restrictions
