Love thy neighbor according to association rules

I’m trying to sort through the stack of paperwork that’s piled up over the last couple of weeks. Since I had holiday tasks to occupy my time, I just stuck incoming items in my office inbox. Now I’d like to move as much as possible to my outbox, AKA the garbage can.

One of the things I ran across was an exchange of correspondence between me and our homeowners association, which is known here in our Austin ’burb as a residential community association. I still call it a homeowners association, or HoA for short.

Regardless of what they’re called, we’ve dealt with these quasi-governmental groups in connection with every home we’ve owned. The first place we bought was a condominium apartment, so it came as no surprise that the condo association was in everybody’s business. That’s to be expected when you’re living in such close quarters.

Our first single-family home also had a HoA, or so we were told. A neighbor came across the street as we were unpacking boxes to collect our $15 fee. We never saw what the fee was used for, though, as we never saw a community newsletter or got any notice of regular meetings or, now that I think about it, ever saw that neighbor again.

We moved about two years later to another suburban Maryland neighborhood and got our first real lessons in the benefits and drawbacks of a HoA. The first couple of years in there, the HoA board president used the community lawn service to improve his personal landscaping … on the community dime.

Then a later HoA president wanted to turn over our open space to the city so that the municipality would pay for walkways through the grass that would make it easier for his kids to get to a local playground. Never mind that we had city-maintained sidewalks on every block; he wanted his kids to take a cemented shortcut through our expansive green space.

A group of us opposed to paving over our own little piece of paradise staged a coup d’etat (proxy votes are a wonderful tool and welcomed by neighbors who didn’t want to be bothered by actually attending the annual meeting) and took over the board, quashing that anti-environmental effort. I had to resign my position when we moved to Florida, but know that friends still there are keeping the HoA in line.

Florida is the breeding ground for Condo Commandos, what with so many retired folks who previously held positions of corporate power and now have time and the need to keep bossing around others. Our place there had incredibly high annual dues, but it was a resort area that needed to be kept looking its best. Plus, the fees took care of the exterior painting of homes, ostensibly to make sure they were done regularly and right, but also to guarantee that no one dared to exhibit any individual choice when it came to paint hues.

Overall, I like homeowners associations. I’ve seen the myriad personal tastes and preferences of my fellow humans and it’s not a pretty sight. I’m sure they think the same about me, but rather than getting in each other’s faces over it, we let the impartial HoA do the dirty work.

Such a sentiment is common. In a column back in November, John Tierney of the New York Times wrote of the HoA phenomenon and its growing acceptance. If you subscribe to the Times Select service, you can read all of Tierney’s column here. If not, here’s the pertinent, for my blog purposes at least, part:

“[W]hen I talked to housing experts, they pointed to another message from the market: people want neighborhood busybodies. A majority of new homes in rapidly growing urban areas are in communities governed by private homeowners associations that impose much stricter rules than governments do.

Some people chafe at the restrictions, but most are willing to pay a premium for them, according to a study by Amanda Agan and Alexander Tabarrok, economists at George Mason University. They found that a home in the Virginia suburbs of Washington that was part of a private community typically sold for 5 percent more than a similar home nearby not governed by a homeowners association.

More than 50 million Americans are now ruled by neighborhood associations, which regulate things like the size of the house, the architectural style, the color and the landscaping. The rules have always sounded creepy to me, but after my town's fight, I'm starting to see why people buy into these communities - and why some economists suggest that small towns and city neighborhoods be allowed to turn themselves into private associations.”

The one bad thing about the HoAs is that while they indeed are semi-governmental, the fees they charge aren’t at all tax deductible. Some people try to write off the annual dues along with other home-related costs, such as the property tax bills I discussed yesterday (just scroll down a little more if you missed it) or other expenses detailed in this story.

If you do try to sneak your association dues in the mix, don’t be surprised to find an IRS examiner come knocking on your front door, which of course is painted an association-approved color. And you could end up paying a lot more than simply your HoA annual dues.       

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[real estate in Philippines]

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