What Are HOAs? How Renters Should Navigate Them

Renting an apartment from a landlord or management company is par for the course, but renting a townhome is a less common occurrence. A townhome, as compared to an apartment, a rowhome, or even a standalone home on a suburban street, is part of a larger living community where certain rules apply. An organization called an HOA enforces these rules, but they don’t do so for free – and in townhome life, there’s no avoiding them.

If you’re looking to live in a rent-to-own townhome, you may be concerned about HOAs and having yet another responsibility – or, worse yet, a monthly bill – to worry about. What are HOAs, what do they cover, and do renters have to pay the fees?

What is an HOA?

An HOA is a homeowners association. HOAs are operated entirely by members of a condo complex or other community of separate but similar homes. They establish rules by which members of the condo complex must abide. In other words, if you buy a condo, HOAs may prevent you from doing every single thing you want to do with your property.

Who should care about HOAs?

HOAs concern people living in condominium complexes, subdivisions, or other planned living communities. Not nearly all homeowners will contend with HOAs – buying that giant house on that idle suburban street doesn’t place you within an HOA’s jurisdiction unless the house is a condo. 

Do HOAs collect fees?

All HOAs collect fees from homeowners. Some HOAs collect fees monthly, whereas others do so annually. These fees are often, but not always, distinct from maintenance fees.

Do renters pay an HOA?

People who rent non-condominium homes don’t need to worry about HOAs. However, if you’re renting a townhome from an owner, you may be responsible for paying the HOA, but it’s unlikely. In many (but not all) cases, the homeowner will pay for the HOA fees since failing to do so can result in foreclosure. When signing a rent-to-own lease, read carefully to determine with whom the responsibility for HOA fees lies.

If I live in a rent-to-own condo, am I an HOA member?

No, but you need to show the same respect for the property as homeowners. When you rent a condo, you’re just as responsible for obeying the community rules as if you owned it.

How do HOAs work?

In a typical HOA, living community members elect a board of directors – who are always residents and homeowners within the condo complex – to develop and enforce HOA rules and regulations about allowable kinds of fencing, landscaping, exterior paint colors, parking, and more. Most HOAs outline these rules in a long legal document known as the Declaration of Covenants, Conditions and Restrictions (CC&R). 

HOAs have rules to follow, too

If the idea of a central housing authority in your small community intimidates you, remember that HOAs have forces to answer to as well. State tenant-landlord laws, as well as the federal The Fair Housing Act, outline the rules by which HOAs and condo owners must play. If you feel that your HOA is taking advantage of you or setting unfair rules, you always have legal recourse.

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