Wednesday, September 08, 2010

http://www2.tbo.com/content/2010/sep/08/pa-homeowners-stand-may-be-shortsighted/

Cars on blocks. Knee-deep grass. Going to seed. Around a neglected above-ground pool. In the front yard. Chartreuse-and-fuchsia repainting jobs. Beds of silk plants. Bordered by pinwheels acquired at a dollar store end-of-the-season closeout sale.

The horror. The horror.

Apocalyptic prospects

The remote chance that one or some combination of these apocalyptic prospects could come to pass on your block is why deed restrictions and their enforcement arm - the homeowners association - evolved. It turns out, apparently, after Woodstock and Vietnam, we no longer trust one another to tend to our corner of the American dream as fastidiously and tastefully as June and Ward Cleaver (the 1980s Clair and Cliff Huxtable notwithstanding).

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To that, the HOA abolitionists cry "HOA apocalypse now!"

2 comments:

The Ants said...

Freedom! Horrible, horrible freedom!

gnut said...

HOA corporations are not necessary to enforce whatever deed restrictions that mandate neighborhood standards.

In the comments sections to Megan McArdle's "No Such Thing As A Simple Mortgage" (The Atlantic, August 3 2010), reader texan99 explained how deed restrictions can still be enforced, without the perverse incentives and moral hazards that inevitably result when HOA unions have the power to use other people's money against them. No fines, no kangaroo courts, no non-judicial punishments, no organized crime extortion rackets, and no corporate communism.

Emphasis added:

I do understand your point about keeping up the deed restrictions, but careful, because you may be falling into a common error. Restrictive covenants are one thing, and HOAs are another. In order to enforce a neighborhood's restrictive covenants, it is NOT necessary to have an HOA. It is true that having a HOA can make it easier to enforce the covenants, in several ways. For one thing, you don't need to find a homeowner to be a plaintiff, although any homeowner will do and it shouldn't be that hard to find one if anyone's really interested. For another, if you have an HOA, you can bill all the neighbors and force them to help pay for the lawsuit. For another, you can enforce the collection of this bill with a lien against everyone's house. Finally, if the HOA wins the dispute with the homeowner whose grass is too high, or whatever (and the HOA always wins, because the rules and vague and discretionary and totally in its favor), the HOA has a lien against the homeowner for the penalties and legal expenses. As in, $700 for the pain and suffering caused by the too-high grass, and $15,000 for the lawyers.

The question is whether all this is a good trade-off. Without the HOA, the neighbors have deed restrictions and any one of them (or group of them) can sue if someone violates the restrictions. The concerned neighbors will have to pass the hat to pay for the lawsuit, so they probably won't sue if it's not pretty important. They can always coordinate all this through a civic club, which probably will be funded by voluntary contributions, which are a pain to collect -- but all these factors make it likely the lawsuits won't get out of control and people won't be losing their homes to foreclosure over silly disputes. Oil stains on the driveway, flagpole too tall, mailbox in non-approved location, shrubbery not up to snuff, miniblinds in front windows not approved shade of ecru -- and I'm NOT making those up, they are from real court cases.

My 50-year-old non-HOA neighborhood in Harris County had mild deed restrictions. The place didn't look like a manicured showplace with totally coordinated everything, but we kept the major problems under control. No management company, no law firm, no out-of-control Inspectors General on the board, no foreclosures, and no bitter divisions among neighbors. Every few years someone tried to convert the neighborhood to an HOA, but they always got voted down after a public campaign. It takes healthy local grassroots political involvement, which has the added advantage of strengthening the community for other purposes.

The whole thing is a lot trickier for townhouses and condos, where I'd think it would be hard to avoid some kind of HOA with teeth.