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Homeowner’s Associations Are Hurting
By JLP | May 13, 2008
From As Dues Dry Up, The Neighbors Pay ($), in today’s Wall Street Journal:
Here’s another consequence of the troubled housing market: Some homeowners associations are running low on cash.
The association at Monaco Place, a community of single-family homes and condominiums in Denver, is short $250,000 of its $9.3 million annual operating budget. It can’t pay for needed roof and siding repairs to homes. Potholes in the streets haven’t been filled in order to save money to keep electricity running in common areas, says Dee Tyler, CEO of Colorado Association Services, which manages the association. Monaco Place was already suffering from a high rate of foreclosures before the credit crunch hit. In the past three years, about a third of its 193 units have been foreclosed on.
Some areas are worse than others:
At Spanos Park East in Stockton, Calif., owners of about 25% of the development’s 1,500 single-family homes have been delinquent in paying their quarterly dues, according to Adrianne Bretao, a manager at M&C Associations Management Services, which helps to manage the community association. As a result, the association has put off expanding a patio area in the clubhouse and swimming pool this year, says Denise Laven, the association’s president.
Wow! TWENTY-FIVE PERCENT! Wouldn’t it stink to be a resident in that community? You pay the big bucks for a beautiful house in a nicely-kept community only to go down the crapper due to foreclosures.
The article also says that banks are refusing to pay association fees even though they are the owners of the property. Some associations are suing banks to try to get them to pay up.
Of course, as I have said time and time again, this isn’t all doom and gloom. EVENTUALLY the housing market will turn around and the houses in these communities will be sold, which will bring in association dues.
We don’t live in a planned community so we don’t have association dues. What about you? Have you noticed your homeowner’s association having trouble keeping things going?
Topics: Housing Market |
May 13th, 2008 at 10:39 pm
I live in a planned neighborhood.
Some homes up for sale (as ford closed here a year ago) but…the CA is keeping up all areas and have published our finances (which they have to do every quarter in the newsletter)…we are still good to go.
May 13th, 2008 at 11:22 pm
I don’t live in a ‘planned community’ for a very good reasons, many of them based on principle, the other reasons stem from the reality: Most homeowners associations that I’ve been a member of serve only to profit the very few. Often, the projects need to be supplemented not just with dues but extra expenses when the repairs are necessary for ‘your block’.
It is, in my opinion, a well orchestrated plan of redistributing funds so that a few can profit from the laziness of the masses who are too blind to pay attention to what is going on.
May 14th, 2008 at 8:35 am
I’m with Ken on this one. I have no use for homeowners’ associations or planned communities. As far as I’m concerned, as long as I comply with local ordinances regarding my property, it’s nobody else’s business.
On a related note, my brother-in-law was fined $50 by his association for letting his grass get too tall. The punchline is, he lives in a trailer park.
May 19th, 2008 at 11:24 am
I live in a community where they are actually doing roof repairs as I speak. I guess I’m one of the few.Hope things get better.