Austin Business Lawyer
Homeowners’ Associations Quick Overview
Homeowners’ Associations (commonly abbreviated as HOAs) are essentially private, non-profit corporations which manage and regulate the “covenants, conditions, and restrictions” of a section of real estate. Increasingly common in the US, HOAs operate much like local governments, though not bound by the same constitutional restrictions placed on local governments.
HOAs are typically created by real estate developers as part of the process of developing and selling property in a neighborhood. Once ownership is transferred to the HOA, it has the power to set rules, collect assessments, and impose fines. The HOA is, in most cases, the legal governing body of the neighborhood. When a homeowner purchases property governed by an HOA, he or she must agree to the HOAs rules and conditions as part of his or her deed. Because of this, courts almost always side with the HOA in disputes over the HOAs legal rights.
Critics of HOAs allege that they are undemocratic entities which are financial and legal liabilities for their “members.” For example, a power of sale clause included in a deed would allow an HOA to legally foreclose on a homeowners’ property without any sort of judicial procedure. Furthermore, the lack of substantial restrictions on HOA boards in most states means that it is difficult for members to control the actions of the HOA.
On the other hand, HOAs may also be very beneficial to the communities they manage. In addition to increasing property values, HOAs can promote community activities, maintain or beautify community property, and promote a safe, clean living environment.
To learn more about real estate and business law,
contact an
Austin business lawyer with Slater & Kennon, LLP, by calling 512-472-2431 today.
Centrally located in the Arboretum area of north Austin, the Slater & Kennon law firm represents clients in Travis County, Bastrop County, Burnet County, Williamson County, and Hays County, including the cities of Austin, San Marcos, Bastrop, Burnet, and Georgetown.