 Purchasing a home is a major milestone in anyone’s life, whether it is a first
home, a vacation home, or a home to enjoy your golden years. No matter what
stage of life you are in, buying a home in a neighborhood you will enjoy is
important. One way to help make sure you are choosing a neighborhood that will
fit your lifestyle is to understand what is expected by the homeowners in the
neighborhood of your choice. By understanding Property Owners’ Associations
(POAs) and Home Owners’ Associations (HOAs), you will be able to make an
informed choice about where to live.
A POA is a non-profit corporation
registered with the State. It is managed by a Board of Directors. The purpose of
a POA is to maintain any and all common areas and to oversee the community in
accordance with the provisions of its legal documents, including Covenants,
Conditions, and Restrictions, Bylaws, and Articles of Incorporation.
To
be a member of a POA, you purchase a lot and then build on it (unless you buy a
re-sale). You can own a lot only and still be a member of a POA. Usually, in an
HOA, there is one builder/developer. The buyer selects a lot and then a floor
plan from the builder in that particular development.
An Architectural
Review Board (ARB) is a committee under the Board of Directors. The ARB reviews
plans for new construction, additions, and any exterior modifications/changes
home owners wish to make. POAs and HOAs both have Architectural Review Boards,
but HOAs usually don’t have one until the development is (nearly) completed,
since there is usually only one builder involved.
Besides sizing up the many amenities POAs offer, such as golf, tennis, beach
access, boating, fitness facilities, etc., you should also familiarize yourself
with your potential neighborhood’s Covenants, Conditions, and Restrictions
(CC&Rs). The CC&Rs are the legal documents which set up the guidelines
for the operation of the planned community as a non-profit corporation. The
CC&Rs have been recorded in the County’s land records and go with the title
to your property. If you fail to abide by the CC&Rs in your community, you
may find yourself getting a phone call or a letter from your POA/HOA requesting
compliance with a given situation. Under extreme circumstances, non-compliance
may garner a fine or sanction by your association.
Bylaws are guidelines
for the operation of the non-profit corporation. The bylaws basically define the
duties of the offices of the board of directors, the terms of the directors, the
membership’s voting rights, notices of meetings, and other items necessary to
run the POA as a business.
Most area associations have developed rules
and regulations as provided for in the CC&Rs and adopted by the board of
directors. Rules are established to provide direction to the homeowners for
common courtesies such as parking, pets and use of amenities. Also,
architectural guidelines with procedures for submitting requests to make
architectural changes to your home will be set forth in the rules and
regulations. These rules and guidelines exists so that residents can have
“peaceful enjoyment” of their property.
An assessment is the periodic
amount due from each owner to cover the operating expenses in their community.
These expenses include, among others, maintaining the common areas and the
neighborhood’s amenities. For communities with security, this cost is also
included in the assessment. POAs rely on the timely payment of assessments to
fund the community’s many operations. Therefore, if an owner is late paying
their assessment, they may be subject to a late fee and possibly
interest.
Experts advise potential buyers to carefully research the POA
of a particular community before they buy. Each POA is different and living in a
POA is not for everyone. If they do not feel comfortable abiding by the rules of
that community’s POA, then perhaps the potential buyer should look for a
neighborhood which will better meet their lifestyle and needs. This research can
help eliminate potential conflicts.
Your real estate agent can give you
the specifics about the neighborhood of your choice. Most area neighborhoods
have the POA information online, or you can contact the POA directly with any
questions and concerns.
|
