Townhomes and defunct HOA

7 Replies

Hello beautiful people of BP,

What are your thoughts on townhomes that now has a defunct HOA?

The properties are essentially now single family homes as far as owner responsibilities (lawn care, individual meters, etc). Many roof lines are actually separated, but some aren't, so obviously some complication there if the neighbor doesn't want to replace the roof and you do (or vice versa). I would say they are B class, not in a densely populated area, but close to lots of developed area (has to be billions of dollars) over the last 10 years.

The building(s) I would be looking at would put me as the primary owner. So owning 3 out of 4 as an example. 

At this point, I probably view the lack of HOA as a good thing, but is there anything I'm glossing over? I don't know what I don't know and would appreciate any thoughts you have.

Check if the defunct HOA has any debt . Have a lawyer answer your questions

Originally posted by @Matthew Paul :

Check if the defunct HOA has any debt . Have a lawyer answer your questions

Thanks for the reply. How would the HOA debt affect me? Meaning, I won't own the entire properties previously maintained by the HOA. So if somebody owned the entity that was the HOA, and the HOA has debt, is there any way their debt could fall on me?

What about the common area , is there a common lawn , storm water management , any property owned by the hoa that requires maintenance ? The hoa is generaly owned by the homeowners . Now you say you will be owning 3 out of the 4 buildings . that is a good thing , you have 3 out of 4 votes . So what you say goes . In theory if you are in control of the HOA you could raise the fees and control how they are spent

I would be concerned about your exit strategy down the line.
Originally posted by @Matthew Paul :

What about the common area , is there a common lawn , storm water management , any property owned by the hoa that requires maintenance ? The hoa is generaly owned by the homeowners . Now you say you will be owning 3 out of the 4 buildings . that is a good thing , you have 3 out of 4 votes . So what you say goes . In theory if you are in control of the HOA you could raise the fees and control how they are spent

Well it's a little different than that. I don't know how far geographically reach the original HOA had. But I'm looking at a total of 11 townhomes in 4 buildings (3/4, 4/5, 1/2, and 3/4 if memory serves). There are probably 100 or so total townhomes in this area that I assume were once part of the HOA.

The HOA does no maintenance as they don't exist. There is an HOA clubhouse that is for sale, again since they don't exist. They are treated like a traditional home, each owner takes care of the maintenance (me as the landlord). Not exactly sure how they bill it, but water, trash, and electric are on a single bill going to the tenant (no gas).

I would go to the local government and see what you can find out .  

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