Maybe you thought all that a homeowners association (HOA) did was figure out who's responsible for cleaning the pool and removing the trash. Maybe you thought an HOA consisted of five elderly neighbors who have nothing else to do. And maybe you're right. But in larger developments, the HOAs are nonprofit corporations that often have a tremendous amount of power over the other owners and the land itself.
The ironic part of this is that HOA boards are typically volunteer-staffed. This means the selection process is determined mostly by who has the time and the willingness to run for the board and then oversee the community for free. While there are often are paid professionals managing the community, running the front office, leading construction teams, etc., the volunteer HOA board is overseeing their work -- and they often learn the job as they go.
Here are 10 powers that could be vested in an HOA via the condo bylaws or community covenants. Make sure you understand the full scope of covenants, conditions, and restrictions (CC&Rs) before you consider moving into an HOA-governed community.
1. An HOA could literally own the land your home is built on
If you live in a regular condominium (not a freehold), you only own the structure itself, not the land on which it's built. That is "common area" and belongs to the corporation.
2. As part of owning common areas, they can own some elements of your structure
This may include the roof, exterior walls, and patio/deck. Because of this, the association can tell you when to paint your house...and what color.
3. Or alternatively, they can just paint your house for you and send you the bill
This aspect of HOA governance is one of the most frustrating for owners. If the association or the board decides, for aesthetic or upkeep reasons, to fund repairs to the entire community, they can vote to do it, and impose a special assessment on each owner to pay for it if there isn't sufficient money in the reserves.
4. They can and will demand control over the actual air in your home
One would really assume that the air temperature in one's home and how they achieve it is nobody's business but the homeowners. In that, you would be mistaken. Because a window AC unit is installed so part of it is on the exterior of the structure, if the unit is deemed unsightly, the HOA watchdogs can demand its removal.
5. They can tell you how to park your car...in the parking space you pay for
Basically, the association/corporation owns the parking lot (common area) and either gives out or leases spaces. But they also make the rules for the parking lot. They might bring in construction workers to do a project that dumps small mountains of dust on parked cars and see this as the association's right. But if an owner decides to park head-out or keep a bicycle in their space in addition to their car, the association may determine it breaks safety or aesthetic rules.
6. They can set rules about how you enter and exit your own home
Most HOAs have rules around reasonable community safety and cleanliness, but the way they get written into some CC&Rs can be very nitpicky. For example, look for rules stating how long you can leave your garage door open, between what hours you are allowed to take out your garbage, or whether you're allowed lawn ornaments.
7. They can fine you if you don't abide by the rules
Whether it's the parking, the garage door, the dumpster at the curb, or the window AC unit, people who ignore the HOA warnings do so at their peril. An HOA's best and most-used weapon is to fine the offender.
8. They can set landscaping rules that may be at odds with the planet's well-being
This is one category where HOA micromanagement tendencies sometimes run afoul of local laws. Planned communities are known to be exacting in their demands that residents only plant a certain type of tree or maintain a perfect green lawn in all seasons. It's frustrating for homeowners who would like to experiment with low-water landscaping even though their area hasn't mandated it.
However, when an HOA attempts to enforce this and bumps up against the county's water restrictions, they risk having the association fined. And if the HOA tries to bully a homeowner into breaking the law, legal experts recommend contacting the county.
9. They can hire unqualified contractors for large common area projects
This isn't usually intentional, but since, as I mentioned up top, HOA boards are volunteers and often learn on the job, they don't come prepared with contact info for reliable contractors. Thus, community improvements often are awarded to the "friend of a friend" of a board member or to the company that gives the lowest estimate. While in theory, the information on who's been hired is always available for all residents to review and even vote on, in many cases, you don't find out till the work is underway.
Chalk it up to human nature: If you live in a building that needs hurricane-impact windows and the HOA board puts out an announcement that they've hired a window company, you don't automatically assume they've made a hash out of the process. You only look into it several months later when, in spite of construction crews hanging around daily, nobody's new windows seem to have been installed.
10. They can take out huge loans for capital improvements and split the bill between you and all your neighbors
This happened in the first condo I ever lived in Miami...and thank goodness I was a renter. The hurricane-impact window replacement project previously mentioned led to the discovery of more structural issues -- requiring more conversations with engineers and contractors, more cost estimates, and ultimately a much larger capital improvement budget than the association was ready for. By the time we left, the association had taken out a $20 million loan and was looking at another, and the owners were on the hook to pay it off.
Know what powers an HOA has before you move
This is by no means an exhaustive list. It varies according to the building/community. That is why every expert advises that you request a copy of the CC&Rs for any community or building you're considering moving into, and also talk to a few of the residents who aren't super involved with community governance. Get a realistic picture of what the HOA is like and whether you want to be governed by it.