I live in Denver, Colorado. My husband and I own a condo that has depreciated in value nearly 30% since we purchased it 5 years ago. That said, we would not be able to sell it today without coming to the table with tens of thousands of dollars just to get out from under. However, we are ready to start a family and need a bigger place. We considered renting out the condo for a few years until we could sell it, but we were told by the HOA that the 25% rental restriction has been reached (only 25% of the units are allowed to be rentals, per the HOA declarations). My question is, what would be the implications if we violated the HOA covenant and rented out our condo anyway, despite being over the maximum restriction? Just how powerful are HOAs? Are we looking at fines? Having to kick out the renters? Thanks for your answers.
2007-10-23 06:22:45 · 8 answers · asked by slovesn 1 in Business & Finance ➔ Renting & Real Estate
You need to read the fine print of what they do to violators. But, it is not uncommon that somewhere on there you signed them over the right to foreclose on your home for the violation. I have seen them try to take over homes over lawn cutting.
HOA's are very powerful and tend to have a network of busy body spies around the neighborhood.
They would have to foreclose (and I am betting they will with glee) before they can kick out your renters.
2007-10-23 06:34:55 · answer #1 · answered by Landlord 7 · 4⤊ 0⤋
Hoa Rental Restrictions
2016-11-07 06:16:39 · answer #2 · answered by ? 4 · 0⤊ 0⤋
In the worst case, the HOA could foreclose on your unit and take it away from you. More likely would be fines and probable eviction of your tenants who would then have a strong case against you. HOAs can be extremely powerful.
It would be better for you to try to apply for a waiver of the 25% limit or see if you can get it removed entirely. Considering that 25% of the units are already rented out, you probably have half of the support you already need to get the rules changed or get a waiver. Offering up professional management of your unit through a property manager (or possibly the HOA itself, if they're interested in some extra cash flow) might get you over the top.
2007-10-23 06:43:39 · answer #3 · answered by Bostonian In MO 7 · 3⤊ 0⤋
The only way to know is to read the CC&Rs of your HOA and see what it says. But it's very likely the penalties will be harsh. And since the HOA already knows you wanted to rent, you'll probably get caught when they see new people living there, but your name still listed as owners. In my experience HOAs have a lot of power (too much IMHO) and can cause a lot of grief.
I wonder if you can move out, but let "family" live there for free. And if your "family" chooses to give you money every month (but it's not rent!) just because they like you a lot, that might work out.
2007-10-23 06:33:41 · answer #4 · answered by likepepsi 7 · 1⤊ 0⤋
Don't do it. HOA's have far more control than one realizes. When you purchased, you also signed the HOA agreement which is a valid binding agreement.
Your best bet is to consult the HOA, and ask to be notified as soon as there is an opportunity to rent based upon that percentage. With any kind of luck, they will comply with your request.
Yes, you would be required to remove renters, which gets very complicated if you signed a lease. You would be responsible for the lease contract as well, and would not be able to provide the housing for which you signed a contract.
2007-10-23 06:36:12 · answer #5 · answered by acermill 7 · 2⤊ 0⤋
Have they proven their statement to you? Do they have a list of how many units are currently occupied by owners and renters and have you done the math. I wouldn't take their word for it - #1
I don't know if this would work where you are but....there is a very nice mobile home park in my area that requires owner occupation only. I heard that someone decided to rent theirs and put the renter on the title to get around that rule.
Don't know if that would work for you but something to think about.
What if you did an 'OWNER CARRY' are those against the rules if you carry the note for the new owners (renters) and offer the condo 'no banks - rent to own'? Just trying to think outside the box for ya here.
Good Luck
OBA™
2007-10-23 06:35:04 · answer #6 · answered by Anonymous · 1⤊ 0⤋
You would need to read carefully the consequences for violating any bylaws. You could do a consult with an attorney, which is usually free. But I wouldn't chance the rath of the HOA. They could take you to court and it could cost you more than it's worth.
2007-10-23 06:27:44 · answer #7 · answered by Anonymous · 2⤊ 0⤋
In worse case, you will be kicked out.
2007-10-23 06:32:22 · answer #8 · answered by Victoria78 2 · 0⤊ 1⤋
If discovered, you will be fined.
2007-10-23 06:29:46 · answer #9 · answered by sunshine 3 · 1⤊ 0⤋