HOA on Rental Property

9 Replies

If you have a rental property in a subdivision that has an HOA, how do you deal with this? I'm assuming you pay for the HOA fee, and just account for it in your rent price. In addition, even though you own the home, the tenant is the one that actually lives in this house, so now they automatically become HOA members, correct?

Members of the HOA are the owners, not the tenants. The owners are responsible for ensuring that their tenants are familiar with and comply with HOA rules and regulations. The owners are responsible for the HOA fees, and owners should take those fees into account when determining the rent.

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Hi Hector,

In my experience as a property manager in So Cal, the owner is the one who owns the home, is on title and is the one that typically pays the HOA. Some HOA's have the ability to let the Tenant identify themselves as the person residing in the property and they must register with the HOA in order to acquire the key/s for the common area, such as the pool, clubhouse etc...

Your rent fee would still be market value and in calculating your cash flow you would take into account PITI (Principal, Interest, Taxes, Insurance) HOA and PMI if applicable. The HOA would not be expected from the tenant in addition to the monthly rent payment.

The owner is usually the member, not the tenant. It is important that an owner share with the tenant the HOA documents such as the CC&R's and rules before they move in and sign a document that it was received by the tenant. The rule and regulations must be a condition of the rental agreement since the Landlord would be held accountable for the renters infractions. A renter would communicate through the landlord any requests to the HOA. It would be advisable for the landlord to provide a copy of the rental agreement to to ensure compliance with the HOA's standards and for the purpose of emergency contact. Keep in mind the Board may demand termination of a tenant with multiple rule violations.

I hope this helps!

~Suzette

I own a condo unit in which I previously lived and now rent out.  My experience with the association has been positive, and I currently serve on the governing board.  Many condo associations and HOAs are poorly run and make bad decisions, but that's not the case for all of them.

Thank you for the thorough answer Suzette! As far as HOAs being evil, they can be good or bad. It all depends on how they are run. But if they are run well, they can be of great benefit to your investment. 

Educate your tenant!

No garbage cans out front
No oil stains on drive
No basketball hoops left out overnight
No junk vehicles
Must not shut of irrigation water to plants
Do not harass my landscaper

The list goes on and on --- then try call and speak to a human -- LOL

But the good thing given all the issues, my neighborhood is very clean.

Hello,

BP's newbie here, I wanted to get some advise on renting out a condo that has an HOA, would I still need a property manager if it is not required by the HOA? I am from NJ and looking to purchase a condo in the Delray Beach, FL area as my first rental property. I understand that I am responsible for the HOA fee's however, depending on what the HOA covers I am not sure I would need the addition of a property manager. I do not want to assume, as we all know what happens when we assume. If anyone would be kind enough to share their experiences or thoughts I would greatly appreciate it.

Regards,

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HOAs in single family properties can cause headaches for landlords.  They are different depending on which state the property is located in.  I am not really a fan of them.

Here a few issues.

1) Make sure the HOA has your mailing address. It is generally your problem if they send the notices of violation to the wrong address.

2) You, not the tenant are responsible to the HOA.

3) If the HOA violates any of your tenants rights or is accused of violating any of your tenants rights you are responsible to your tenants. I know an HOA, where the house where you pick up the pool passes has a confederate battle flag hanging up. You should also know that almost all judges know that one of the original purposes of HOAs was to prevent racial minorities moving into neighborhoods. If ANY tenant EVER says they want out of the lease because you would not believe what someone from the HOA said to them. LET THEM OUT IMMEDIATELY.

4) In some states, it might be legal for the HOA to prohibit you from renting the home.

5)  Homeowner managed HOAs are extremely different from "professional managed" HOAs.  In most places, they can change back and forth with every annual election.

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