In Clark County, Nevada there's little tolerance for owners of foreclosed REO (Real Estate Owned) properties who fail to keep them up to county building and HOA standards. Clark County is levying daily fines of $1000 for failure to correct violations of Clark County Code Title 11, the Rehabilitation of Abandoned or Rental Residential Property, according to this Las Vegas Business Press story. The newspaper reports the fines and similar sanctions levied by homeowners associations "have already chased away prospective buyers" who would have to pay them.
The upshot is if REOs aren't maintained and the fines rapidly accumulate into big liens, the properties could ultimately become worthless since the cost to acquire them with the county and/or HOA liens tacked on could reach an appreciable fraction of their already depressed market value.
This is a real economic firefight arising out of the residential real estate crash that could end up with no winners and plenty of casualties. The owners of the REOs would lose and so would Clark County and HOAs with their jurisdictions littered with unmarketable, dilapidated properties.
2 comments:
The HOA corporations and the industry represented by CAI are already turning HOA burdened homes into unmarketable property.
Many, many homeowners resolve to NEVER live in or own HOA-burdened property after experiencing life in HOA-burdened property. The experience is far from that publicly represented by the industry hacks.
Existing owners need to make sure that their ownership in these places is affirmatively terminated. Otherwise the banks will avoid the foreclosure to leave the owner with the liability. HOA fining should be wholly illegal to begin with and is a perfect example of the duplicity used by the industry hacks. Who does "fining" preserve value for? Certainly not the owners of the property.
The best part is that the harm done by the HOA corporation to individual properties is so bad that it is proving that the existence of the HOA corporations hurt the property values of ALL the property burdened by the HOA corporation. The myth that HOA corporations "preserve property values" has been exposed - HOAs don't preserve value for the owners of the property but rather for all the vendors that feed off of involuntary membership corporations.
> Many, many homeowners resolve to NEVER live in or own HOA-burdened property after experiencing life in HOA-burdened property.
> The experience is far from that publicly represented by the industry hacks.
In a 1999 Gallup poll commissioned by the Community Associations Institute, 75 percent of respondents said they were ''very or extremely satisfied'' with their associations. ''People are moving to communities like that because they are looking to create a lifestyle for themselves,'' said Paul D. Grucza, president-elect of the institute.
But only 40 percent of those surveyed said they would buy their next home in a community governed by an association.
"Homeowner Board Blur Lines of Just Who Rules the Roost"
New York Times
July 27, 2003
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