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Showing posts with label zoning. Show all posts
Showing posts with label zoning. Show all posts

March 7, 2011

Are Homeowner Associations, or HOAs, Necessary?

Hi Folks,

   Hope you had a great weekend! Spring is coming, and many people are happy. I am personally a huge fan of cold weather, but that is rare...I know !

   Today we will explore a few sides of the HomeOwners Association, or HOA, debate. There are many folks who say that HOAs are not needed, and there are many others who strongly advocate HOAs. Let's take a step back from the drama of all of that, and see what an HOA is and see what are it's functions, advantages, and disadvantages.

   Let's start out by discussing the duties of an HOA, which, "serve some benefit such as the uniformity of appearance in a community, offering of amenities, and the maintenance of our landscaping.". says Deborah Haataja-Deratany, a Legal Liaison of an HOA. Kerri Fivecoat-Campbell, a homeowner and a blogger, expands on this and says that many HOAs, "put a limit on the size of homes that can be built in neighborhoods". John Paul Hanna, an Attorney, notes that, "California law requires that all common interest developments ("CID's) have a homeowners association, either incorporated or unincorporated. The main advantage of an HOA is that it has power to enforce".

   Sharon Van Buskirk, a Marketing Director, says that she lives in a designated Historic District in Dallas they, most definitely need" their HOA to serve as, "a concerted voice when the winds of City Hall blow afoul and threaten our unique neighborhood."

   This leads us to our next piece of the puzzle, which is the Structure and management of an HOA. "Overall, I feel that HOA's in the state of Florida are a disaster, particularly because of the intense legislative lobbying efforts from the lawyers and the insurance industry and the lack of accountability for developers, boards, and community association managers (CAM's). Boards of directors have incredible power. It is an abomination that Board members are often neophyte volunteers, charged with the significant fiduciary of being entrusted with millions of dollars in budgets, and hundred of millions of dollars in real estate, etc., often times with little or no experience in related fields", says Haataja-Deratany, who goes on to say that their, "expected or required standard of performance is minimal!". She also says that, "virtually, the only requirement is that they own property in the respective community."

   Haataja-Deratany suggests that in order to serve on an HOA board, one should be, "required to possess credentials related to this industry, much like other corporate boards in this country. Board members should also be required to have a stake in their performance on a Board (carrying E&O or comparable insurance of their own)."

   Michael Garard, with Garard Real Estate, says that where the HOAs get a, "bad rap" is from the attorneys who help oversee the board of directors. Garard says that the attorneys, "have the mind set of 'black and white' decisions, and once you let a small item get changed, then everyone else will follow the lead, so the attorneys advise to fight (very expensive to the HOA) and not to give an inch." He adds that most board of directors are typical homeowners who just want to, "help their community, they are not professional, just volunteers", and that the attorneys are paid hourly.

   Sharon Blanding, a former civil engineer who has worked on many "Planned Unit Developments", feels that any new community should be, "regulated more by HOA covenants than by city/county zoning laws.", and says that most people, "do not realize the extent of the controls and regulations most cities have on the books. Even small cities can have volumes of regulations. (I worked in San Diego and Seattle, and the controls are beyond believable. But even little towns on the outskirts could easily have 30 to 50 volumes of regulations.)". Blanding surmises that, "perhaps we could get rid of some of the excessive government controls this way. (Some of the people running HOAs are truly crazy though, and there does need to be constraints built into the original documents, similar to a constitution, that limits their powers.)"

   In regards to HOA fees, this will vary by community, and for example, Vinny Amatulli of the Foxhall Subdivision in Georgia, says that his HOA has "established a means to help with short-term and long-term budgeting process, eliminating the need for homeowner assessments. Our current dues is $600 per year and has only been raised three times in the past 16 years. I can only assume that fees vary by region, even within our local area."

   Garard points out that future resales in a community, "will come from buyers whose first impressions is of the 'look' of the subdivision, which is where the HOA and the covenants can keep up the look of the community."

   Is your home part of an HOA community? If so, did we miss out on anything that the HOA does or doesn't do? Do you think HOAs are necessary? We'd love to hear from you!

Have a Great Week, and Happy Rent-to-Owning !

Rob Eisenstein
HomeRun Homes Blog http://blogging.lease2buy.com
HomeRun Homes Website http://www.lease2buy.com

TAGS: #HOA #developer #developments

July 21, 2010

Examining the Home Building Process, Part 1

Good Morning,

   At the request of our readers, we are beginning a 3-part series on the Home-Building process. We always receive a lot of questions about how the process actually works, and we have made contact with some solid resources to bring you some pretty good information that should be incredibly useful to you.

   David Spetrino of Plantation Building Corp (in Wilmington, North Carolina), uses a 10-step process that brings buyers from start to finish. The first step involves meeting their potential customer to identify their wants and needs (this is where you describe your custom dream home and the ideal “move in date,”). They need to know, for example, if you enjoy entertaining in your home, if this is a primary home or a vacation home, and if you would you describe your ideal home as formal, casual, or a hybrid of both styles. They will also ask you if you have any “green” requirements (environmentally-friendly)

   Next, they will discuss where the home will be located. If you have a lot ("home site") already, that's fine, and if you provide them with the address or community of choice, they will do the research regarding setbacks, zoning, architectural standards, etc. After this, they move on to the professional service agreement, estimate preparation (where they collect bids from their trade contractors and vendors), and ultimately, the construction contract (which involves the construction schedule and your financing). Spetrino makes it a point to note that, "the bank that provides the construction financing may not always be the bank that retains your long term mortgage. You have likely provided your lender with tax returns and related financials. Your bank will want us to supply them with a copy of the construction contract, set of construction drawings, specifications and the budget."

   During this process, the General Contractor comes into play, and there are some pointers provided by Arlene Battishill, a licensed general contractor in Los Angeles. Battishill notes that any proposed home site must be zoned for residential use, and you will need an accurate legal description of the parcel, soil testing, and a structural engineer’s review of the architectural plans to determine if any special reinforcement will be required. Once a licensed general contractor (“GC”) is hired, cost estimates can be made, and once acceptable, the architect or general contractor will submit the architectural plans to the local government building department for evaluation. Once all changes are made and the building permit fees are paid, construction can begin.

   From this point on, Spetrino's company works out the full details, and then begins construction. They provide, "regular updates, photos, and twice monthly, a ‘cost report’ that tracks budget and schedule." Over the course of construction, sometimes changes need to be done, and these requests go into a written format, officially known as the ‘change order.’ Once the "Big Day" arrives, a thorough "inspection and orientation of your new home" is completed. After one month, they schedule a follow up walk through to make sure that you are completely happy, and they also schedule a one year walk through.

   Battishill notes some of the costs of the process, for example, purchasing the land, the fees paid to all of the required consultants, fees to the local government and then the cost of construction. She notes that financing should be obtained well in advance of construction, and to assume that you will need 25-50% more money than the budget calls for to ensure successful completion, as cost tends to overrun in the construction of new homes.

   Please join us on Friday for part two in this series, where we have some additional pointers and points of view from a Property Manager and an Interior Designer.

   Have a Great Day, and Happy Rent-to-Owning !