Millions of Americans live in communities governed by a homeowners association (HOA), and the number has only increased in recent years.
But many buyers don’t known much about the HOA they’re joining, and the boards typically like to keep it that way.
An HOA could have meticulous rules about landscaping, be overbearing about house upkeep or even implement a major price hike on fees down the line.
But in Florida, it seems the tables may have turned in the power dynamic between HOA boards and residents.
Sellers are increasingly desperate to unload their homes in the saturated market, and buyers are using that to their advantage.
Savvy purchasers have started their own investigations into the history of buildings, and are asking for detailed budget information from HOA boards before they sign a contract. Some are even demanding to see financial records stretching back years.
Increasingly, panicked sellers and HOA boards are having to fold to buyers’ every desire.
Florida realtor Jaclyn Bild told the Daily Mail about one instance where buyers required a meeting with the HOA president before purchasing.
Florida real estate agent Jaclyn Bild, pictured
‘That was the craziest one,’ she said. ‘The demands buyers are coming up with can get insane.’
HOAs are meant to oversee general maintenance of the neighborhood using a pool of money made up of dues paid by residents in the area.
For example, it may remove a fallen tree on community property, upkeep shared swimming pools or make sure the neighborhood is landscaped.
Some can get extremely involved in what residents do with their properties, and tyrannical HOA boards are so notorious that they’ve been used as plot points in TV dramas like Desperate Housewives.
It is a storyline many Americans across the country can relate to: When new residents of the fictional neighborhood decided to install a bold water sculpture outside their home on idyllic Wisteria Lane, it was met with a wrath of fury from the local HOA.
But when it comes to real-life living, Bild says the tide is turning in favor of prospective residents.
Buyers’ requests and demands have gotten out of hand, she said, but in a buyer’s market, a seller will do almost anything to close the deal – even if that means begging their HOA president to open their financial books to an outside party.
Bild recently sold one Miami condo that required she fulfil a very unusual request that she’s seeing more and more: Before signing anything, the prospective buyer demanded a Zoom conference with the condo association president in order to ask all their burning budget questions.
The buyer wanted to find out about whether there might be costly repairs coming up or an unanticipated bump in HOA fees.
Bild said this was the first time she ever had a client ask for a meeting like this.
In fact, she says the HOA board would likely have turned down the request, but since condo sellers and their real-estate agents are having to put in more work in order to get deals through, she managed to pull it off.
‘The deal would have fallen through without that call,’ she said. The buyer is now in contract for the condo.
Tyrannical homeowners association boards are so notorious that they have become part of TV drama plots in shows including Desperate Housewives
The Desperate Housewives plotline saw new residents install a water sculpture outside their home in the idyllic community, much to the fury of the local HOA board
Buyers who follow the real estate market have grown wise to rising HOA fees and the importance of building reserves, Bild told the Daily Mail.
‘Now, someone really wants to understand every line item of an HOA budget, what went up, what went down and why,’ she said.
‘The smart ones are asking questions and want to understand the financial profile of the building or home.’
Some communities in Florida are seeing their HOA fees soar by thousands of dollars.
The increases are in part to cover rising insurance costs in the state and to meet the obligations set out in new legislation following the June 2021 Surfside condo collapse in South Florida that killed 98 people.
The collapse happened when faulty support columns in the tenant garage and adjoining pool deck buckled. Federal investigators said the steel-reinforced concrete columns in the doomed building were half the strength they should have been.
A mad rush to repair residential buildings followed, with HOAs charging huge monthly fees to fill their empty reserves.
Plus, more frequent natural disasters in the state, such as hurricanes and flooding, have driven up insurance costs and led HOAs to raise fees in anticipation of repairs and mitigation needs.
One Florida town, Winter Park Woods, just a 20-minute drive from Orlando, left its residents in a state of panic after tripling its monthly dues to more than than $3,300.
Lorraine Roy, a resident who has lived in the community for 30 years, had the monthly fee for her three-bedroom condo raised to $3,371.79.
The Winter Park Woods Condominiums Association told residents they were hiking fees because it owes Orange County millions for code violations.
A new law now requires structural inspections for condos more than 30 years old and additional money to be set aside for repairs, leading to an increase in required payments.
Neighborhoods all over Florida are seeing a surge in listings, but few sales
Condos on the water in Florida aren’t moving as fast as they once were
During the Sunshine State’s pandemic housing boom, buyers would ordinarily close on a house and be handed a pile of documents, but usually not bother to find out if their costs would be changing.
‘Many people weren’t reading through them because there’s no easy way to understand them,’ said Bild. ‘You buy the condo and you get a 300 page deck. No one was reading that.’
But times have changed.
Bild’s clients are panicking that they’ll land on a budget, and then be met with empty building reserves they will have to contribute to or an HOA jump they didn’t see coming.
‘People just want to understand,’ Bild said. ‘Are our reserves going go up every year? How much more? Is the building doing anything to save money?’
HOA board members and presidents used to be in a position where they could refuse to speak to potential buyers, but now they don’t want to face the prospect of condos and houses sitting on the market for too long.
This means they are being forced to be transparent, which includes divulging how much dues have jumped over the past three to five years if asked.
Bild says as a realtor, she now has to have personal connections with HOA board members in order to close deals.
And it’s not all about budgets.
Bild said she is currently selling a condo unit that needs to be renovated, and the buyer wants to know before purchasing if they will be able to make the windows larger.
‘They want to know now, instead of after buying, what the restrictions are,’ she said.
Trying to find the buyer an answer means chasing down HOA board members for approvals – if they don’t get back to her within a week, the deal could fall through.
Buyers have grown savvy about rising HOA fees and building reserves, realtor Jaclyn Bild says
‘People who are smart or who are making their first purchase are asking all the right questions,’ Bild added.
‘All they hear in the news is negative and people want to understand what they are getting into.’
Bild recently closed a sale for a young professional couple buying their first condo.
‘Before closing, they wanted to understand when the next building assessments were coming and if there were enough reserves to cover any repairs and factor those into their purchase price,’ she says.
‘They’d rather calculate that into their cost today and not be blindsided after buying.’
Clients also used to trust Bild to relay information she had gotten, as HOAs typically wouldn’t agree to share information directly with someone who hasn’t purchased yet. But now, prospective buyers want everything in writing.
Some communities in Florida are seeing their HOA fees soar by thousands of dollars as a result of higher insurance premiums and new laws
Sellers are pushing their HOA boards to be open and available for buyers, and many are lowering the price of their home to offset a future special assessment of the property.
Bild is now proactive about providing prospective buyers with the building’s current budget and board meeting minutes from the past year.
‘We have to go above and beyond as agents,’ she told the Daily Mail.
‘You need to really know people on the board, know the building’s history as well and need to get favors done. That’s how buyers feel more comfortable.’
