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A Guide to NC Homeowners’ Associations

In western North Carolina, there are many subdivisions that have a homeowners’ association (HOA). The last thing you’d want when buying a home is to be caught off guard by the power of your HOA. Here is a guide to North Carolina HOAs to better prepare you for your home search.

What is the purpose of an HOA?

Every person that purchases a property in a subdivision that has an HOA automatically signs up for membership within the HOA. There are a few reasons why HOAs impose rules and restrictions on homeowners. The first is to keep and enhance the aesthetic value of a subdivision and to maintain property values. The second is to enable homeowners to live comfortably without the annoyance non-members or members who may cause a disturbance within the premises. Not every subdivision has an HOA. Homes located within a subdivision do not necessarily have an HOA. Check with your agent to be sure!

How much are HOA fees, and what are they for?

In most cases, an HOA will require its members (residents of the neighborhood) to pay a fee on a recurring basis (monthly, quarterly, or annually). These fees can cover numerous costs like private road maintenance, security/gate features, water/sewerage, common area maintenance, and pool access–just to name a few. HOA fees can be set for a period of time, but they can increase if the HOA board votes to do so due to cost increases over time. Fees can vary depending on the type of property (single family home vs. condo/townhome), number of properties in the group, location, amenities, and operating expenses.

What else might I be required to pay for?

Special assessments. An HOA “special assessment” is an extra fee that an HOA board may charge under certain conditions, like unforeseen damage to the community pool or community-wide storm drain replacement. Be sure to ask your agent if there is a planned or approved special assessment on the property because you (as a buyer) may be held liable for paying the added fees once you purchase the property!

Multiple HOAs. Although uncommon, some communities have two homeowners’ associations. Let’s just say, for example, that a subdivision has a few condominium buildings, some townhomes, and a dozen single family homes. If you purchase one of the condominiums, you may be subject to one HOA fee for your condominium upkeep (exterior repairs, roof, etc.) and a second HOA fee for the common areas of the larger neighborhood (landscaping, pool & tennis courts access, etc.).

What are HOA ‘Bylaws’ and ‘Restrictive Covenants’?

Ask your agent for a copy of the subdivision’s bylaws and covenants. Bylaws outline how HOA board members are elected, conduct their meetings, etc. Restrictive covenants (sometimes called Covenants, Conditions, and Restrictions, or CC&Rs) outline any rules that the HOA board imposes on its members–some HOA covenants are much more strict than others. Although restrictive covenants are sometimes difficult to read and understand, your agent should be able to help you.

Will they dictate what my home looks like?

The power of each HOA varies greatly–some have no restrictions and others have a long list of restrictions. You may have to seek approval from your HOA prior to making any architectural changes to your home, like paint color or additions. Take a look at your HOA’s restrictive covenants to see if they have an ‘Architectural Control Committee’ (or something similar).

What are the repercussions for non-compliance?

Your HOA’s restrictive covenants should outline penalties for violating the guidelines set forth in the agreement–fines, forced compliance, or even litigation.

What are my rights?

Subdivisions with HOAs that were established after January 1, 1999 are governed by the North Carolina Planned Community Act. However, no state or federal agency oversees homeowners’ associations. If you’re unhappy with a decision made by your HOA, consider asking the board to review the issue or consult with a private attorney.

Have more questions?

Give us a call at (828)771-2329, and we’d be happy to speak with you!

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