In Defense of HOAs

I began my residential land development career almost forty years ago. And there is one memorable moment that has guided my vision for new home communities ever since. Many of you may remember Larry Carr and his partner at the time, Barney Gottstein, who together developed several new home communities, including Bayshore and Southport. As a new and relatively inexperienced land developer, having come from the real estate brokerage industry, I felt like I was taking my PH.D orals, as I stood before the icons of the industry. At the end of my presentation and only then, did Larry Carr speak, “I only ask that ten years from now when I drive through the community, I want to feel a sense of pride.”

And that, my fellow readers, developers and realtors, can only be accomplished with a homeowners association. So lets assume for a moment that all residential developers are well-intended and want to create an attractive new home community whether it’s the future entry level or the multi-million dollar home environment. It all begins with the land selection. Then, you work through the entitlement process; zoning and platting requirements until you finally create a site plan that not only fits in the surrounding neighborhood but contributes to the economic development of the broader community. It is the developer’s vision of what she would like the neighborhood to look and feel like from the roof pitch to the landscaping. The goal is to create a compatible community with individual distinctions for each home selected by the home buyer. Some of the decisions that need to be made by the developer are items you might not even notice when driving through a new home community. What about the use of drones? Number of pets? Fencing types and locations? Where to put the RVs and fishing boats? Whether or not home businesses can be allowed? Child care and beauty salons are the most commonly requested businesses. Are detached garages and outbuildings allowed, and if so, what are the sizes and locations on the lot? How much of a lot can trees be removed to enhance a homeowner’s view of the mountains or inlet? And what about growing marijuana for personal consumption or for sale?

However, none of these tough decisions can be sustained unless you have a Homeowners Association. The developer controls the first home built with the recorded covenants, codes, and restrictions. But once the developer completes his work and moves on to the next project, there is no one or entity to continue ensuring that the CCRs are upheld without an HOA.

Then, the only recourse a neighbor has for getting the three junk cars removed on the adjacent lot’s driveway is to sue in Superior Court which is expensive, time consuming and is rarely done. However, not only does there need to be an HOA but the HOA also needs to have the ability to issue reasonable fines with a 30 day notice. Without fines there is no enforcement. The two, three, five years that the developer has control of a community before it is turned over to a board is when it doesn’t seem important to have an HOA. But seven or ten years later when your neighbor decides to paint his house canary yellow, you will wish you had one.

After the developer has sold 75% of the homesites, she must turn the association over to an elected Board of Directors. She will, if the declaration states, retain final approval of each structure to be built. How HOA’s develop a bad ‘not in my backyard’ attitude is when they overreach on the restrictions, particularly when it comes to design and remodeling. Most board members come from a variety of professions and backgrounds. Most are not architects, landscapers, homebuilders, land surveyors, or interior designers—those individuals who are best qualified to maintain the vision. Volunteers may also lack management expertise and failure to monitor subcon¬tractors and budgets. And then, of course, there is the internal politics within the HOA. Not so much different than most boards. As the community ages, many of the architectural requirements may become obsolete. The Municipality of Anchorage has passed an ordinance where residential zones can now have a duplex, not just a detached ADU. Materials for exteriors have changed dramatically. Forty years ago, there was no metal siding or ‘faux’ wood shin¬gles. Now, some garages are larger than first floor living spaces. These changes may conflict with existing covenants, codes and restrictions and, thus, create conflicts not only within the HOA but with MOA regulations as the city seeks to stabilize a wobbling housing ladder as they struggle to revamp design and zoning restrictions.