Hiya all, I am pretty new to the forum; this is my second post and first thread, so please be gentle... but I have been reading voraciously! :)
I have a question (maybe a few) regarding HOA fees and I haven't been able to find a thread that addressed this issue exactly.
I found a distressed home in a pretty nice neighborhood that is listed at an attractive price, so I went to have a look. Afterwards, I spoke with a couple of neighbors to get an idea of the history of the home, why it may be listed so low, etc... While filling me in, one of them told me that the neighborhood did have a HOA and in talking about that a little, he let me know that the HOA strongly discourages rental investors by charging a $12 per day fee for renting. So.. what I thought might be some really good numbers for my first deal sort of seem to turn out lousy if that sort of covenant is allowed.
I have not seen the HOA documentation first hand yet; I do have an email out to the realtor listed for the home but I don't have a response yet but I intend to collect as much as I can. I guess my long-winded question is this: Assuming the homeowners I spoke to are on the level, is this sort of penalty/behavior even allowed or legal from an HOA? The home is in the Memphis/Shelby County, TN area, if location is relevant to the question.
I see your're from Olive Branch, I'm from "down the street" in Memphis. From my understanding, as long as its legal, HOA's can enact any rules they want. I would suggest looking for other rentals in the neighborhood if this fee does exist and see if they are paying it. My guess would be no as that would probably wipe away any profit from rental income.
Hey Shawn, thanks for the reply. Yeah, I live in OB and am looking in my vicinity as well, but this particular property is up toward Lakeland. I will drive the neighborhood and look to see what other, if any, for rent signs there are and maybe I can get the skinny from the owners by calling and inquiring.
I just can't wrap my head around a $360 monthly penalty just because the owner chooses to rent it out (the total annual HOA fee is $180 I think for owner occupants.. I am pretty sure that's what the neighbors told me). Just seems very disproportionate and punitive, quite frankly. :-/
I forgot to mention that this is not a condo or apartment setup either; this is just one of those little neighborhoods where the houses are really close together (picture reaching out your window and nearly touching the bricks on the house next door).
Really appreciate the information!
Interesting to hear, Jason. That is news to me.
I have heard of HOAs putting restrictions on homeowners but this is the first I've heard about restrictions on landlords. It may be a sign they are "anti-landlord." I'd be cautious moving forward especially since they may change the rules again in the future.
Hope that helps!
Kinda had me thinking the same thing. At this point, I'd be a little nervous stepping into the deal even if it still sounded sweet just because I'd always suspect they'd just try and turn it sour on me later.
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