The Gene Molloy Real Estate Blog

June 2008

Jun. 9, 2008 - Make And Model Revisited

Just like the different types of Community Associations, the laws that apply come all shapes and sizes too. For instance, there are three different types of state laws, or statutes, that apply to Community Associations. You have your general, your specific, and your uniform types.

A general statute applies to Community Associations as well as other types of organizations. If your association is incorporated, which most are, then the corporate laws of you state apply to your association/corporation.

Specific statutes are association specific. Mostly they exist to to provide for the establishment and operation of a community as a legal entity. Some of them regulate development and sale. Some provide protection for purchasers, owners, and tenants. Some regulate operation. The specific statutes are probably the most important type. They take precedence over the declaration and bylaws. Since they can be amended by the state legislature it is important to stay on top of them if you want to be a home owner who is in the know.

Only about one third of the states have adopted any uniform statues. The National Conference on Uniform State Laws is attempting to get a standardized set of statutes going but there is some resistance. For a person who moves around a lot, or owns properties in multiple states, the adoption of uniform laws regarding association living could be a real blessing.

So you see, there is a little more to community association living than just offer, acceptance, and move in. An educated homeowner, is a happy homeowner, indeed.

As always, if you have found yourself receiving my blog postings via e-mail, it is because I have either blogged about you personally, blogged about something I know is of interest to you, or I consider you to be a person of deep thinking and intellect and I would love to have you occasionally commenting on my blog. If you would like to be removed from the list simply send me an e-mail saying so.

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Jun. 6, 2008 - What Makes Them Think They Can Do THAT?

Many a disgruntled new homeowner, having just moved into a community association with out being made aware of what they are getting into, has lamented over that question. Hopefully there is someone around who can answer that, but if not, let me give it a try.

If a community is being run properly most of the decisions made by its Board of Directors are not as arbitrary as they may seem. A community has certain legal obligations that are derived from many different sources. First and foremost there are federal, state and local statues and regulations that must be adhered to. There is a whole body of case law that attests to that. If you do not want to take my word for it just google court decisions regarding community associations. Then there are legal documents that are specific to each community association that bind the association and the owners. These documents would include declarations and by laws, rules and regulations, board resolutions, etc, etc.

As if that was not enough, there are lender requirements to contend with. Some lenders will balk at giving mortgages in a residential community that has too high of a percentage of non owner occupied, or investor owned unit. Getting an FHA loan in a community that has a first right of refusal built in to the declaration can sometimes be problematic.

Sometimes the decisions are based around standards that are set by other professional associations, like the American Institute of Certified Public Accountants for instance.

There are many outside sources that define the existence, activities, and actions of a community association and that, my friends, is what makes them think they can do THAT.

As always, if you have found yourself receiving my blog postings via e-mail, it is because I have either blogged about you personally, blogged about something I know is of interest to you, or I consider you to be a person of deep thinking and intellect and I would love to have you occasionally commenting on my blog. If you would like to be removed from the list simply send me an e-mail saying so.

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Jun. 5, 2008 - Checking Out The Make And Model

Basically, the are three different types residential community associations. Some of them even have sub species. Allow me to expound.

First you have your Planned Community. In this type of community the homeowner owns their dwelling and the piece of land the dwelling is built on. All of the common areas and usually the amenities such as swimming pools, roads, clubhouse, tennis courts, etc., are owned by the community. If you live in, or are considering a community like this then you will be a member of either a Homeowners Association (HOA), an Owners Association, a Townhouse Association, a Property Owners Association (POA), or a Planned Unit Development (PUD).

The next model is the Condominium. When you live in one of these you are the proud owner of your living unit and an undivided interest in, or a percentage of the common elements. The common elements are everything except the actual living units. They can include things like the pool, the lobby, the corridors, the garage area, etc. The community association as a whole does not own any real estate.

That brings us to the third type, the Cooperative. What you own if you live in one of these is stock in the cooperative and a proprietary lease, also know as an occupancy agreement for your living unit. This lease defines your rights and obligations as they pertain to the living unit. The community association, which is usually set up as a not for profit corporation, owns all of the real estate.

Any one of these three types of associations can be stand alone or clustered. If they are clustered they are general either a Master or Umbrella Association, or a Mixed Use Development. The former would consist of more than one residential community association and the latter would consist of a mixture of residential, commercial, and maybe industrial use properties.

So you see, because each of these different associations depend upon a different form of ownership, it is very important that you, and more importantly your REALTOR®, know what you are getting into before you decide to buy in. Everybody will be happier if you know what you are getting into.

As always, if you have found yourself receiving my blog postings via e-mail, it is because I have either blogged about you personally, blogged about something I know is of interest to you, or I consider you to be a person of deep thinking and intellect and I would love to have you occasionally commenting on my blog. If you would like to be removed from the list simply send me an e-mail saying so.

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Jun. 3, 2008 - So Let Me Repeat Myself

Since I am pounding on the subject of Community Associations and the importance of what you should know before you consider moving into one, I feel a bit of review may be necessary. Whether it be a Condominium, Townhouse, Co-op, or a detached single family home in a Home Owners Association, the primary reason people find association living attractive is that the association is looking out for the governance, the business, and the communal aspects of the associations members, the homeowners. By the establishment of of a system of property rights, covenants and restrictions, and rules and regulations the association is administered, maintained, and enhanced for the best interest of it's members. If you don't know anything about it, you need to research an association just like you would a new town that you might consider moving into. In essence you are moving into a little government where the over all community is going to be run like a business. If you are the kind of person that needs to be free to march to your own drummer a Community Association is probably not for you.

As always, if you have found yourself receiving my blog postings via e-mail, it is because I have either blogged about you personally, blogged about something I know is of interest to you, or I consider you to be a person of deep thinking and intellect and I would love to have you occasionally commenting on my blog. If you would like to be removed from the list simply send me an e-mail saying so.

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