Friday, October 22, 2010

NC may examine powers of HOAs next year

Candidates would consider limiting powers of homeowner associations

A local lawmaker and state senate candidate say they want to look at issues involving homeowners associations during the next General Assembly session, which begins Jan. 26.

“I suspect we will be looking into that because we’ve got some homeowners associations that are completely out of control,” said Rep. Danny McComas, R-New Hanover. “I do feel that finding a means to control some of these HOAs is going to be necessary.”
This is a wasted endeavor at best and a cynical political ploy at worst.

If legislators and candidates truly believe that non condo HOAs have the power of municipalities without checks and balances on their powers, they should deprivatize them and take them out of state nonprofit corporations codes and instead bring them under government codes.


Anonymous said...

True, but this is one of the few times that candidates have been willing to make reigning in HOAs [and their agents] a platform issue. Usually candidates are unwilling to listen to anything about HOAs. Who knows, they might receive overwhelming support from the constituents on that issue alone. You see, to the victims of the HOA industry there are few issues that affect them as negatively and on as many fronts as unscrupulous HOA agents controlling the HOA burdening the homeowners' property.

Fred Pilot said...

I've historically rejected the premise that HOAs are amenable to meaningful reform because I believe they lack popular support among voters as an institution.

People will reform something they believe in and want to preserve. I don't believe that's the case with mandatory membership HOAs. Many people fundamentally reject their authority as a legitimate form of local government.

Also, the fact that HOAs are private local governments organized under nonprofit corporation law works against a good governance culture based on limits on the use of power and transparency and accountability, making them resistant to reforms.

Anonymous said...

Agree with Fred's premise but again it is rare for a candidate to make HOA corporations and their unscrupulous agents a campaign issue. Apparently politicians were susceptible to the false claims that the majority of people (i.e., voters) liked their HOAs. The industry fog is failing to obscure reality any further. Can't wait to see what politicians do when the fog fails to conceal the fact that the vast majority of homeowners absolutely despise the HOAs, their unscrupulous agents, and all the off-the-book monies that residents pay to benefit the HOA vendors.

Evan McKenzie said...

I think the focus of legislation will be shifting soon from HOA/condo process regulation to the financial side of this housing sector. The real estate development industry is a complete wreck. The banks that made construction loans are not lending and instead they are trying to figure out what to do with the thousands of units of housing they now own. The rest of their time is spent deciding who to foreclose on. Many developers and builders are out of business. Many thousands of condo associations and HOAs are insolvent. After this election is over somebody has to start picking up the pieces. The main concern now should be the owners who are losing their homes and/or being stuck with huge liabilities courtesy of their CID.

Fred Pilot said...

The residential real estate mess is also adversely affecting muni and county governments. They however may be able to weather it better than HOAs given their superior economies of scale.

Condos are a whole 'nuther animal. They are on shaky financial ground even in the best of times due to the demographics that tend to buy into them (first time and last time buyers and investors).

Anonymous said...

The Communisty Associations Institute will simply portray any attempt to regulate HOAs as socialist intervention in the free market.

In the current political climate, it will be easy for the CAI to co-opt the useful idiots for privatized communism and block any reform.

Just read some of the comments at HOA Legi-Slate about the Ombudsman bill in Colorado:

"We don't need more government."

"Looks like more government intervention into our lives."

"The nanny-state needs no enhancing. We don't need another governmental autocrat or agency dictating to the private sector how to behave. Third,all HOAs have, or should have, appropriate Rules of governance, and those should be uniformly, humanely, and sensibly applied within their HOA."

"This is another level of bureaucracy which is not needed."

"Is the State of CO now going to tuck me in at night? Give me a break!"

"Homeowners have adequate avenues to address issues, and we do not need another government expense and interference in our lives."

And this is just for a worthless Ombdus office with no power. Imagine the outrage if the state actually tried to regulate HOAs.

Anonymous said...

Thank you for alerting me to something I regret to have totally missed (the Ombudsman bill in Colorado). After a quick glance at the comments posted on HOA-Legislate, I can't help wondering whether someone alerted a select group of HOA board members to post comments.
Had I been "on the ball", my comments would have been much different.