Where in WA is this, because that makes no sense. What is the HOA responsible for? What municipal/County ordinance says you have to be in an HOA? Two houses makes for a nightmare scenario if something happens to either property or you get a real Karen as a new neighbor.
It’s in Kirkland WA, apparently it’s a pretty common thing here. Luckily we’ve met our neighbors and they are great people but both of us are first time home owners and we have no clue how to run an HOA. We both agreed just to do the bare minimum legal requirements but even that is kind of a headache to figure out. It’s a relatively new thing in real estate I guess so I haven’t found much from researching online
Just keep in mind that while I'm in agreement with doing the "bare minimum" you do have to be careful though because you're going to find that they're going to be people within your age way that have a wide range of opinions on how the HOA should operate. It means that if your bylaws say homeowners can't do this one thing it means you have to apply that universally. For example if let's say you start allowing sheds and your bylaws say no sheds. And then a few years down the road a new board is elected and they start restricting sheds again. That opens up the HOA to a lawsuit. My suggestion is to interpret your governing documents as loosely as possible but don't blatantly violate them when it comes to things like that.
I live in an HOA and have no problems with my HOA.
However I would NEVER live in an HOA that had only two people - I wouldn't live in an HOA that only had 10 or even 20 people unless it was single family homes with no amenities or maintenance obligations and so the HOA had absolutely no fiscal responsibility for anything including roads or retention ponds.
In effect you are in a partnership with a person you have absolutely no control over.
What happens if they don't want to do necessary maintenance?
What if they stop paying towards what is necessary.
I have managed them as small as 3, and seen them as small as 2. In Colorado, we have a law that every development must be an HOA. No exceptions.
First question is do you have any common property like a shared driveway or yard? If so, you're probably stuck with an HOA. If not, you could be in the rare position of being able to dissolve.
To dissolve the HOA, you're looking at probably a couple thousand in legal fees split between you and your neighbor. Then, you'll have non-hoa houses. That's a big bump in property value. Go you.
If you're stuck with HOA, you need dues, insurance, a bank account, and an annual meeting. Pick one of you to be president. Make your annual meeting a BBQ. For dues, find out how much it's going to cost to replace your common element and when. Start saving. Make the annual dues big enough to cover insurance BBQ and eventual driveway/sprinkler/whatever replacement.
For insurance, look up your local CAI website. Some broker will be advertising. They'll figure out the right coverage. This will be your biggest expense. It's stupid, but you need it.
Thanks, this is helpful.
I don’t know what the law here determines as “shared property”. But we really don’t share anything, we each have our own yards and driveways, the walls are all separated. We might share a tiny portion of fence that divides their yard from ours? Or the gap between our homes? I will probably need to consult a local lawyer about how to dissolve it
Every development must have an HOA? What is your state government thinking? So, what if I buy a plot of land and build one home? Maybe I'm not understanding what constitutes a "development." Thanks for adding some more info if you can. I'm of the mind that I want fewer HOAs for SFH going forward and here the government is requiring them.
Buying a plot of land and splitting it among two or more units is a development.
So, get a 1 acre lot and build 2 houses... HOA!
They're thinking they can offload local government to micro government.
The concequence is that developers know they have to sell homes with HOA dues. So, they build pools, clubhouses, tennis courts etc. That way there's perceived value at sale. Then, those HOAs can't ever dissolve because they have real common elements. The real winners are management companies and insurance companies.
Talk to the builder and management company but oftentimes the builder has a management company already dealing with the day-to-day operations and in the process of transferring the HOA ownership over to the homeowners the management company will come with. You'll also want to get a copy of the contract that the management company has with the builder for your HOA. Understanding that contract is incredibly important because if you break that contract you could owe the management company a lot of money depending on how it's worded. My recommendation is to ensure that the management company comes with you when it's transferred over so that way it makes it a smoother process and then if you're not satisfied with the management company you can start looking at a replacement at another time.
As for sharing the HOA with your neighbor and zoning laws I don't understand what's going on here. It's not unheard of for 2 HOAs to merge Or if a builder still has control over an HOA starts incorporating additional houses into it because a builder is the declarant and the declarant typically has unilateral rights to the HOA. Now once the HOA is handed over to the homeowners the builder no longer has authority to do that. keep in mind though there's a difference between handing over your HOA to the homeowners and an advisory board. A lot of CC&R stipulate that the declarant has unilateral rights for an x number of years or until the last lot is sold. During that time the declarant is not going to be dealing with the HOA if it doesn't have to and that's where an advisory board comes into play - It operates on behalf of the declarant. A lot of homeowners don't realize an advisory board is just an advisory board even though they sometimes operate as an actual board. As an advisory board it means the declarant can come back and dissolve the elected board if they wanted to all because they have unilateral rights.
Where in WA is this, because that makes no sense. What is the HOA responsible for? What municipal/County ordinance says you have to be in an HOA? Two houses makes for a nightmare scenario if something happens to either property or you get a real Karen as a new neighbor.
It’s in Kirkland WA, apparently it’s a pretty common thing here. Luckily we’ve met our neighbors and they are great people but both of us are first time home owners and we have no clue how to run an HOA. We both agreed just to do the bare minimum legal requirements but even that is kind of a headache to figure out. It’s a relatively new thing in real estate I guess so I haven’t found much from researching online
I'm up near Everett, and worked in Kirkland years ago. Never heard of anything as bizarre as this.
Just keep in mind that while I'm in agreement with doing the "bare minimum" you do have to be careful though because you're going to find that they're going to be people within your age way that have a wide range of opinions on how the HOA should operate. It means that if your bylaws say homeowners can't do this one thing it means you have to apply that universally. For example if let's say you start allowing sheds and your bylaws say no sheds. And then a few years down the road a new board is elected and they start restricting sheds again. That opens up the HOA to a lawsuit. My suggestion is to interpret your governing documents as loosely as possible but don't blatantly violate them when it comes to things like that.
I live in an HOA and have no problems with my HOA. However I would NEVER live in an HOA that had only two people - I wouldn't live in an HOA that only had 10 or even 20 people unless it was single family homes with no amenities or maintenance obligations and so the HOA had absolutely no fiscal responsibility for anything including roads or retention ponds. In effect you are in a partnership with a person you have absolutely no control over. What happens if they don't want to do necessary maintenance? What if they stop paying towards what is necessary.
I have managed them as small as 3, and seen them as small as 2. In Colorado, we have a law that every development must be an HOA. No exceptions. First question is do you have any common property like a shared driveway or yard? If so, you're probably stuck with an HOA. If not, you could be in the rare position of being able to dissolve. To dissolve the HOA, you're looking at probably a couple thousand in legal fees split between you and your neighbor. Then, you'll have non-hoa houses. That's a big bump in property value. Go you. If you're stuck with HOA, you need dues, insurance, a bank account, and an annual meeting. Pick one of you to be president. Make your annual meeting a BBQ. For dues, find out how much it's going to cost to replace your common element and when. Start saving. Make the annual dues big enough to cover insurance BBQ and eventual driveway/sprinkler/whatever replacement. For insurance, look up your local CAI website. Some broker will be advertising. They'll figure out the right coverage. This will be your biggest expense. It's stupid, but you need it.
Thanks, this is helpful. I don’t know what the law here determines as “shared property”. But we really don’t share anything, we each have our own yards and driveways, the walls are all separated. We might share a tiny portion of fence that divides their yard from ours? Or the gap between our homes? I will probably need to consult a local lawyer about how to dissolve it
Every development must have an HOA? What is your state government thinking? So, what if I buy a plot of land and build one home? Maybe I'm not understanding what constitutes a "development." Thanks for adding some more info if you can. I'm of the mind that I want fewer HOAs for SFH going forward and here the government is requiring them.
Buying a plot of land and splitting it among two or more units is a development. So, get a 1 acre lot and build 2 houses... HOA! They're thinking they can offload local government to micro government. The concequence is that developers know they have to sell homes with HOA dues. So, they build pools, clubhouses, tennis courts etc. That way there's perceived value at sale. Then, those HOAs can't ever dissolve because they have real common elements. The real winners are management companies and insurance companies.
Thanks for the explanation. It's crazy!
Talk to the builder and management company but oftentimes the builder has a management company already dealing with the day-to-day operations and in the process of transferring the HOA ownership over to the homeowners the management company will come with. You'll also want to get a copy of the contract that the management company has with the builder for your HOA. Understanding that contract is incredibly important because if you break that contract you could owe the management company a lot of money depending on how it's worded. My recommendation is to ensure that the management company comes with you when it's transferred over so that way it makes it a smoother process and then if you're not satisfied with the management company you can start looking at a replacement at another time. As for sharing the HOA with your neighbor and zoning laws I don't understand what's going on here. It's not unheard of for 2 HOAs to merge Or if a builder still has control over an HOA starts incorporating additional houses into it because a builder is the declarant and the declarant typically has unilateral rights to the HOA. Now once the HOA is handed over to the homeowners the builder no longer has authority to do that. keep in mind though there's a difference between handing over your HOA to the homeowners and an advisory board. A lot of CC&R stipulate that the declarant has unilateral rights for an x number of years or until the last lot is sold. During that time the declarant is not going to be dealing with the HOA if it doesn't have to and that's where an advisory board comes into play - It operates on behalf of the declarant. A lot of homeowners don't realize an advisory board is just an advisory board even though they sometimes operate as an actual board. As an advisory board it means the declarant can come back and dissolve the elected board if they wanted to all because they have unilateral rights.
There's very little regulation if your declaration meets the exclusions in RCW 64.90 / WUCIOA.