What You Should Know About HOA’s In Florida
How much do you know about HOA's in Florida? Do you understand the HOA covenants and restrictions? What about HOA dues, fees or special assessments?This article will be your guide and give you an overview on what you should know about HOA's in Florida. HOA’s or homeowner associations in Florida are usually commonplace in most new, single family home developments, and usually in every condominium and/or townhome communities. The HOA is the ruling and administration organization in the complex, community, or development, and is typically comprised of an HOA board that is made up of volunteer homeowners.
How Florida Homeowner Associations Work
The main concept regarding a homeowners’ association (HOA) is that the residents of the community elect volunteer homeowners to the board of directors of the HOA. The board of director’s act as the governing body that oversees important issues that come up in the community. The main responsibilities of the board include representing the community resident’s best interests in protecting the value of their homes, by the enactment and enforcement of covenants and restrictions which are the rules that the community has agreed to abide by. Additionally, the HOA board is responsible for the assessment and collection of HOA fees, which are used to pay for the maintenance of the community common areas and any other designated areas that are detailed in the covenants and deeds.
HOA Fees and Dues
Homeowner association dues are generally calculated dependent on the amenities available in the community and maintenance of the common areas. Amenities include such things as gate at the front of community, clubhouse, community pool, tennis court, children’s playground, etc. Maintenance of the common areas include lakes, ponds, right of ways, medians, exterior painting, parking areas, sidewalks, streetlights (in communities that include private streets), and roofs. In certain communities group rates may be negotiated for trash pickup and/or cable and internet services and these may be part of your dues. Generally, dues are collected monthly or quarterly in most HOA’s, however dues collected annually are less common. Not paying your dues to the HOA can lead in a lien being placed on your property which if not resolved may result in your property being foreclosed.
If you are making a potential purchase in a new community, you can ask to review the homeowner’s association budget and see what the actual costs have been. By reviewing the HOA dues prior to purchasing, you can ascertain whether the total cost is a good deal and/or within your budget.
If your purchasing a home in a subdivision that is still under construction, chances are that the developer is in charge of the homeowner’s association. When the community is 10% percent from completion as required by Florida law, the developer gives the homeowner association control over to the residents, which is called a turnover. This means that 90% of the homes in the community have been sold and a closing has occurred. Even when a turnover occurs, the developer is still accountable for the maintenance of the community streets and common areas, as well as setting up the HOA budget and dues that the homeowners will be required to pay. In many cases and in order to attract buyers to the community, the developer will pad the budget with his own funds so that the HOA dues for the new homeowners will be low. However, as soon as the turnover occurs, HOA fees go up due to the developer no making any additional contributions to the budget.
HOA Membership is Mandatory
If you’re wondering whether you can get out of a homeowner’s association membership, you cannot. In Florida, generally when you purchase a home, condo, townhouse, or villa that is overseen by a homeowner’s association, your membership in the association is automatic. There is no choice involved as the purchase of your property creates a contract with the HOA. The contract states that you agree to follow the rules and regulations of the HOA as well as pay all of the dues, fees, and any special assessments that may arise. More on special assessments later.
Homeowners Association Common Rules and Regulations
Communities with homeowner associations contain rules and regulations in documents called covenants and restrictions. You can ask for a copy of the covenants and restrictions for the community before you execute a purchase agreement. Additionally, you can contract your purchase with the contingency that the covenants and restrictions must meet your approval and understanding.
Homeowner Association Fence Regulations
Certain communities include restrictions regarding fences. These fence restrictions usually address the style, height, color and material that the fence is made from. Fencing issues are very common simply because many homeowners do not take the time to read through their HOA Covenants and Restrictions. If you are a pet owner and the community that you would like to relocate to does not allow fences, you may have to see if you can install an alternative such as an invisible fence.
Homeowner Association Sports Equipment and Kids Playground Regulations
Portable basketball hoops have become very popular in the last few years, especially for the homeowner that does not want to secure a basketball headboard just above the garage, since this is a more permanent option. Unfortunately, a great number of communities not only restrict the more permanent basketball headboard, but also the portable version as well. Children’s slides and swing sets are also generally prohibited. Most community HOA’s say that kid’s playground equipment worsens in the outdoor conditions and becomes rusty and very unattractive for the community. Additionally, in communities where lawn services are included in the monthly dues, make it more challenging for the landscapers to mow the lawn.
Homeowner Association Parking Regulations
Many homeowner associations have parking restrictions. Generally, these restrictions are imposed as a result of fire and police being able to adequately get through in case of an emergency, however the community aesthetics are also an issue. A great number of these restrictions include overnight and street parking. This can become a problem if you frequently have company over. If you do a lot of entertaining, make sure you see what your options are, and if the HOA can make some concessions for you.
Homeowner Association Exterior Home Regulations
If you are contemplating making a change to the exterior of your home, you will most likely have to get permission from you HOA. In Florida, a majority of homeowner associations require that any modifications to an exterior of a home in the community must be reviewed and approved by an architectural and/or design committee prior to any changes taking place. Changes to the exterior include painting your home a different color, adding a swimming pool, or adding a screened patio just to name a few.
Usually your HOA, will require that you fill out forms describing all of the changes that you would like to make, the names of contactors or persons who will perform the work, as well as the materials that will be used. Additionally, any drawings, plans or representations will have to be submitted with your paperwork.
Homeowner Association Pet Regulations
Almost all communities have some kind of pet restriction in Florida. This can range from the size of the pets, type of pets, type of breed of dog, and number of pets. Almost all of the dog breeds which are considered aggressive are prohibited due to the obvious reason of protecting persons in the community from being bitten. Additionally, there are not only HOA rules regarding picking up after your dog, but also municipality and/or city ordinances that are in affect.
Homeowner Association Home Value Protection
While the dues, fees, and restrictions associated with an HOA can be a headache for many homeowners. If we examine the restrictions and the cost associated with their enforcement, we see that their main purpose is to protect the value of your home. Whether you’re investing in a condo to rent out or live in, the HOA can be very helpful in ensuring that your property will at a minimum maintain its value.
Condominium Association Fees
Owners of condominiums are also subject to association fees. In Florida, condominium associations are governed by Florida Statute §718. In Florida, you may cancel your purchase contract through a “cooling off” provision within 7 days for a new condo or 3 days for a resale condo. This provision gives potential condo buyers time to review the condo fees, dues and budget.
Condominium association fees generally pay for maintenance of the grounds and common areas, exterior of the building, insurance, swimming pool, club house, and/or other amenities. In many instances, the condo fee includes services such as garbage and water.
Whether you live in a condo or a home, at some time you will be hit with an association bill called a special assessment. Special assessments are typically a one-time large fee that is used for the community that the association budget cannot afford from the regular fees and dues that are collected. Special assessments are used to pay for repairs beyond ordinary maintenance such as a new roof. Some of these special assessments can be very costly, in fact there have been many cases when homeowners were foreclosed out of their home because they could not afford the special assessment. If you’re buying a home, condo, townhouse or villa, ask to see what the special assessments have been historically. This will give you an idea how the association runs its reserves.
Homeowner Association Board of Directors Powers and Duties
As previously described in the article, the HOA board of directors is the body that governs the community. The board may assign management of certain activities to other persons or entities, for instance a property management company, however the board still maintains the ultimate control.
If our considering volunteering for a seat on the board, you will need to familiarize yourself and understand in detail all of the HOA rules, covenants, conditions and restrictions, and bylaws.
Generally, the homeowner association board of director’s powers and duties include the following: enforcement of the declaration, bylaws, covenants, and restrictions for the management and ownership of the community; paying taxes and/or assessments so as not to become liens on the common areas; contract on behalf of the HOA for insurance; contracting on behalf of the HOA for services and goods used on the common areas; power to delegate to committees, employees, and/or officers of the homeowner association; prepare and organize budgets and financial documents; creating rules for the common areas; holding proceedings for rule violations against association members.
Homeowners Association Board of Directors Personal Liability
If an HOA is organized as a non-profit corporation, the duties of its board of directors must be performed in good faith, with the best interest of the corporation, and with the care of a reasonably prudent person in similar circumstances. Additionally, the directors of an HOA, are prohibited in self-dealing, meaning that their decisions cannot be made for the benefit of their own interests rather than the members.
Furthermore, a board member of the HOA may freely rely on the advice of other officers, committees, or professionals hired to assist the HOA in a particular manner such an attorney or an accountant.
In the event that an HOA finds itself in a financial predicament, such as not being able to pay a company for their services, the director of an unincorporated association can be held liable for debts and obligations HOA if the director: assumed the responsibility for the debt personally; signed a contract without first explaining that he was acting for the benefit of the HOA; or executed the contract without authority.
Although the directors of an HOA are generally no held to be personally liable for conduct of the Associations corporation that caused injury. HOA directors may be held liable if their own conduct caused the injury. In certain conflicts, the directors or officers of an HOA may not be held liable above the insurance limits that are set by law.
What You Should Know About HOA's in Florida A Few Final Thoughts
The best defense a homeowner has against their homeowners’ association is to be well informed of their rights and obligations. To learn about your HOA, begin by reading the documents that control the HOA’s power. These include the Bylaws, Declarations of Restrictive Covenants, Articles of Incorporation and any Rules and Regulations. In Florida HOA’s are governed by Chapter 720 of the Florida Statutes. Although there is no agency that enforces the Florida HOA statutes, the Department of Business and Professional Regulation deals with elections and recalls. This leaves the homeowner with one option and that is to litigate against the HOA, however before filing a suit, pre-suit mediation must occur.
Homeowners should also be aware that if a new state law is enacted, it cannot be retroactively applied to change the HOA governing documents. Your HOA Bylaws, Declarations of Restrictive Covenants, and Rules are contracts. There are several exceptions to this, first if your governing documents state that they are “subject to Florida Statute Chapter 720 as amended from time to time,” or Florida Statute Chapter 617 and or 607, in the event that the association was created before Florida Statute Chapter 720 was enacted. Obtaining a copy of the Florida law at the time that the HOA documents were recorded can be found at the county courthouse where the property is located.
Are the new laws not helpful to homeowners against HOA’s? The answer depends on how the law changed, procedural or substantive. Generally, a procedural change will typically apply, whereas a substantive law that establishes more restrictions on the homeowner will most likely not be upheld. An important fact to remember is that there is no applicable defense for the failure to pay your HOA assessments.
HOA's are becoming more prevalent all over the country. After reading this article you should have a basic understanding of how the HOA functions in your community