HOA Security Camera Policy Every Board Member And Homeowner Should Know

To a homeowners association looking to strengthen security, the idea of installing surveillance cameras might be attractive. But, you can’t just slap on a bunch of cameras around your community and call it a day. You must craft and follow an HOA security camera policy that will protect your association.

 

What to Include Your HOA Security Camera Policy

Security is a common concern among many homeowners in HOA communities. And while associations have a handful of options to address it, one of the most popular recourse is to install security cameras around the neighborhood.

But, the mere presence of security cameras can put the association at risk of liability. Therefore, it is important to lay down a set of rules that your HOA can follow and use to protect itself. When creating your HOA rules for security cameras, consider including the following:

 

1. Align With Aesthetics

Let’s face it — giant chunks of metal dotting your neighborhood doesn’t exactly scream beauty. Plus, chances are, security cameras won’t go well with your community’s aesthetics. Since an HOA’s primary purpose is to maintain curb appeal and protect property values, homeowners might argue that installing security cameras can only have a detrimental effect on the appearance of your community.

If you do decide to install them anyway, though, make sure to plan it out carefully. See to it that they won’t impact the appeal of your neighborhood in a negative way. Security cameras come in all shapes and sizes, and some of the designs are very sleek, too. Go with the ones that will fit in the best with the style of your community.

Moreover, you should plan for seasonal changes. If you plan to install outside cameras, make sure they are made with durable materials and can withstand even the harshest of weather conditions.

 

2. Regulate Placement

A common conundrum HOAs encounter is where to place security cameras. This is where privacy concerns come into play. Homeowners have a reasonable expectation of privacy, so you should never point cameras directly into their homes or any area deemed private. This includes backyards and windows as well. It should also go without saying that you should never install security cameras in private locations like shower rooms and changing rooms.

 

3. HOA Monitoring and Reviewing Footage

hoa security camera policyYour HOA video surveillance policy should define what happens to footage once it is created. Will the HOA assign or hire someone to monitor the footage? Is someone just going to review them afterward? When and what time will they do that?

Sometimes, the HOA can’t afford to have anyone monitor the cameras. In that case, you should post a sign telling passersby that the cameras are recording footage but no one is currently monitoring them. You might think this is counterintuitive as it gives criminals a leg up, but it is more of a liability issue than anything else.

 

4. Access to Footage

Similarly, your HOA security camera policy must outline who has access to the footage. Make sure to only give access to select people and only allow law enforcement to view the footage in private. You should also keep saved footage in protected folders, never in personal computers, so that nobody can just open them as they please.

Additionally, you should make it clear to homeowners that they will not have access to the security footage. Let them know that these cameras exist to monitor and deter crime in common areas. They are not to be used for personal reasons. In the event that a homeowner would like to view the footage, they must go through the proper channels and issue a subpoena.

 

5. Destruction of Footage

Finally, your HOA security camera policy should state how long the association will keep the footage before it is destroyed. There is no universal standard for the duration of storage, but something like 30 days is a good place to start.

It is imperative that you communicate the HOA’s policy on security cameras with all members of the community. This way, homeowners will know what to expect and how to proceed.

 

The Law on HOA Security Cameras

Are security cameras a violation of privacy? When it comes to the installation and placement of security cameras, it is essential to check federal, state, and local laws for guidance. Generally, though, the law says that you can install security cameras provided they don’t interfere with residents’ rights to a reasonable expectation of privacy.

Again, this means you can place HOA or condo security cameras in public spaces but never in locker rooms, restrooms, and changing rooms. Cameras also can’t face privately-owned areas like the interior of a resident’s home. Security camera laws can differ from state to state as well, so it is best to talk to an attorney before taking action.

 

The Law on Audio Surveillance

It is illegal to record private conversations without the consent of the parties involved. Thus, if your security cameras record audio as well, you may violate the law and put the HOA at risk. Thankfully, most security cameras forgo audio recording and only record video.

 

What Do Your Governing Documents Say?

Can an HOA put up cameras? It depends on the homeowners association. Not all HOAs have the same rules about security camera installation. To know what your HOA says about the matter, you must check your governing documents.

Some governing documents may stay mum on the issue, especially for older communities. In that case, it is a good idea to amend your documents to include your HOA or condominium security camera policy. When in doubt, consult your HOA manager or attorney.

 

Installing Security Cameras in Common Areas

installing security camerasHomeowners associations usually place security cameras in and around common areas. Many do this in an attempt to discourage criminal activity or catch them in the act. Security cameras don’t come cheap, though, and you should expect to pay ongoing expenses even after installation. This includes maintenance and video storage expenses as well as the cost of upgrading the entire security system.

But, not all HOAs have the budget for security cameras. This brings up the question of whether or not it is advisable to install dummy cameras instead. If you decide to go with dummy cameras, remember that you are still bound by security camera privacy laws.

While dummy cameras are significantly less expensive and can discourage crime, it is generally not a good idea to use them over real cameras. The HOA might face liability issues when a resident becomes a victim of a crime and mistakenly believes the camera caught all of it on tape.

Another point of contention is whether or not to post signs alerting people of the camera’s presence. Although there is no law that requires HOAs to post these signs, you should still make sure to inform all homeowners of the locations of the security cameras. Moreover, posting a notice or sign can enhance their deterrent effects.

Are homeowners associations required to install security cameras? Unless state law or your governing documents say so, HOAs are not required to install security cameras around the community. Make sure to check with your HOA manager or attorney if you feel unsure.

 

Can an HOA Restrict Security Cameras?

Can HOA deny security cameras? Homeowners associations can prohibit members from installing security cameras in common areas, as the HOA should be the only one with the ability to do so. When it comes to cameras in individual properties, though, you should check state laws and your governing documents.

Can I still cameras in my condo or home? Homeowners or condo owners can generally install cameras in the interior of their property. For outdoor cameras, though, not all associations have the same rules. An HOA may allow it provided it does not violate their neighbors’ reasonable expectation of privacy.

If your HOA decides to permit it, homeowners must still follow the HOA rules regarding security cameras. You can also consider establishing an approval process for outdoor cameras on homeowner property, especially since these can be considered architectural changes and may impact curb appeal.

 

Balancing Security and Privacy in HOA Communities

Although security is not entirely the responsibility of an HOA, residents will feel more at ease living in a community that works to promote it. Surveillance cameras can help prevent crime, but they also bring up the issue of privacy in neighborhoods. To make sure your HOA remains protected, it is critical to come up with an HOA security camera policy of your own.

An HOA management company can also help you navigate the complexities of video surveillance. Begin your search for the best one in your area today using our comprehensive online directory.

 

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When Is The Right Time For Reopening HOA Amenities?

The coronavirus pandemic has forced the world to adapt, and homeowners associations are no exception. As the country slowly starts to reopen, HOAs are left with the problem of whether or not to follow suit. Is reopening HOA amenities now the right decision?

 

Reopening HOA Amenities Amid the COVID-19 Pandemic

With no immediate end in sight for this worldwide health crisis, homeowners associations everywhere are starting to toy with the idea to reopen amenities. It is, after all, within members’ rights to use community amenities like pools and tennis courts.

Reopening HOA amenities may also help boost the mental and emotional health of association members. But, safety remains an important factor that HOA boards must take into consideration.

The Centers for Disease Control and Prevention (CDC) has released guidelines designed to help communities mitigate the spread of COVID-19.

Similarly, the Community Associations Institute (CAI) also published a set of guidelines called “Healthy Communities” that can help HOAs protect residents as they adjust and reopen. It is also worth checking with your State Department of Health and County Health Departments for additional support.

 

Shielding the HOA from Potential Liability

Liability is a common point of concern among associations when it comes to reopening HOA amenities. This can mainly stem from the association’s purported negligence in reopening amenities or from the association promising the members’ safety.

Homeowners associations and their boards must never make a promise they cannot keep. That includes guaranteeing the safety of amenity users.

Even if the HOA creates a plan and does everything in its power to do so, it can never guarantee that members will not contract the virus while using the amenities. Members can also follow the new rules to a T and still end up sick.

To protect your association from liability, it is imperative to avoid making any such promises. Instead, warn all members that these new guidelines cannot guarantee their safety. If they choose to use community amenities, they acknowledge and accept the risks involved.

Some associations ask members to sign blanket waiver documents to free the HOA and its board from potential liability. Before you decide to take the same route, make sure to consult with your HOA attorney first.

 

Strategy Tips When Reopening Your HOA Amenities

sign in a field asking people to socially distance | reopen amenitiesNot all associations are permitted to reopen common areas and amenities. Before making a decision, check your state or local government rules and regulations for any related provisions.

This includes provisions regarding public facilities such as pools, clubhouses, gyms, tennis courts, and the like.

Once you have the all-clear and decide to reopen amenities, here are some strategy tips you can adopt:

 

1. Create and Distribute Emergency Rules

Rules exist to maintain order, but they are also designed to keep members safe. Most HOAs must follow standard procedures when creating or amending rules.

But, in some states, HOAs can adopt emergency rules without the need for normal procedures. For instance, in California, associations can enact emergency rules with a maximum effectivity period of 120 days. Sample rules include requiring the use of face masks and limiting the number of people in any given amenity.

In addition to creating these rules, HOAs must put them in writing and communicate them to all members. It is also a good idea to post these emergency rules in every common area or amenity.

Furthermore, you must warn members that the HOA and these rules do not guarantee their safety. Include this disclaimer in all posts and notices.

 

2. Make Use of an Amenity Booking System

In an effort to limit the number of members at any given time, some HOAs have adopted the use of a booking system. With such a system in place, residents can pick and reserve timeslots for each amenity.

Once a timeslot is full, other residents cannot book it anymore. This will allow your association to control the number of members at each amenity for every time period.

 

3. Allow Space for Social Distancing

Since the coronavirus passes primarily from person to person through respiratory droplets, social distancing can significantly mitigate the spread of the disease. But, it can be a challenge to practice social distancing, especially in tight or cramped spaces.

As a response, associations must create space to promote social distancing. You can do this by modifying the layout of each space.

Consider removing unnecessary furniture or making use of tape to mark areas where users can stand. In gyms and fitness centers, turn off every other machine or equipment.

 

4. Adopt a More Frequent Cleaning Schedule

Because the COVID-19 virus can survive on various surfaces for extended lengths of time, HOAs must clean and disinfect amenities more frequently. Make time in your schedule to close down amenities for regular cleaning and disinfection.

Use EPA-registered disinfectants that have been proven to kill the coronavirus. High-touch points, such as doorknobs, handles, railings, light switches, elevator buttons, and the like, must be disinfected at least daily.

If your HOA does not have the resources to clean and disinfect amenities and common areas, consider hiring a cleaning service. Most cleaning companies can come in at regularly scheduled times to accommodate your needs.

 

5. Provide Sanitizers and Soap

A closeup of a woman cleaning her hands with a sanitizer gel | reopening your HOA amenitiesProper hygiene is of utmost importance now more than ever. To encourage this, post reminders for residents to wash their hands frequently.

On the association’s part, consider installing sanitizer or alcohol dispensers in common areas and amenities. Make sure that soap is also readily available in bathrooms and sink areas.

 

6. Be Prepared for Change

There is no telling when the pandemic will come to an end. Similarly, no one can know for sure what the future holds. You might reopen the pool one day and end up having to close it down the next.

As such, refrain from sticking to a single approach to safeguard your community and its residents. Instead, monitor the situation on a daily basis and be prepared to make adjustments as instructed by government officials and health experts.

 

A Safer Environment for All

When it comes down to it, there is no blanket answer as to the right time for reopening HOA amenities. Every community may have its own set of factors that can affect the board’s decision to reopen.

For starters, make sure your local government allows it. Consider the health of your members, including mental and emotional. If you do decide to reopen your amenities, create and communicate rules that residents must follow.

Adopt strategy tips that can help you keep a safe environment. Lastly, remember to protect the association from liability by warning residents that their safety is not guaranteed.

 

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Halloween COVID 19 Activities: How to Safely Have Fun in Your HOA

Halloween is just a stone’s throw away, but many HOA communities are finding it hard to come up with activities to do during the holiday. With the coronavirus pandemic keeping everyone indoors and anxious, calm yourself down and enjoy some spooky fun with these Halloween COVID 19 ideas.

 

Spooktacular Halloween COVID 19 Ideas for HOAs

During pre-COVID times, HOA neighborhoods used to be filled with costumed kids parading door-to-door with their parents in search of treats. Parties took place in every city, while haunted houses served to entertain and terrify willing (and some not-so-willing) guests. To many, Halloween is an opportunity to get creative and have some fun.

The COVID 19 outbreak, though, has forced the nation at large to change its plans. Parties are too crowded and trick-or-treating has too much close contact. But, that doesn’t mean your HOA community has to remain quiet come Halloween night. Residents can still enjoy Halloween during COVID 19 with the following fun yet safe activities:

 

1. Carve and Decorate Pumpkins

It’s almost impossible to imagine Halloween without pumpkins — they’re a staple, after all. The best part is that decorating and carving pumpkins is an activity that the entire family can enjoy. Let your kids express their creativity and draw what they want to on the pumpkins. Parents should then do the cutting since it involves a sharp object. Be careful not to injure yourself, too, though!

Instead of a candle, place battery-operated lights inside the carved pumpkins. This eliminates the risk of a fire. Plus, battery-operated lights last much longer than candles do. For a healthy and on-theme snack, take the pumpkin seeds and roast them in the oven at 300 degrees for 45 minutes.

 

2. Host a Remote Costume Party

Just because you can’t have a Halloween party doesn’t mean you should skip wearing costumes. Organize a virtual costume party with your friends or relatives. You can use Zoom, Skype, or other video conferencing platforms.

For HOA communities, invite the entire neighborhood to participate in a remote costume contest. This will take some planning and communication, though, so start early. If local authorities allow it, you can even put on a costume parade. Residents can don costumes of their choice and walk through the community while observing social distancing protocols. Those who wish to watch can do so from a safe distance or even indoors.

 

3. Make Halloween-Themed Treats

What’s a good way to get in the Halloween spirit? Make spooky treats, of course! This Halloween COVID 19 activity is particularly great because it teaches kids how to prepare food, allows them to express their creativity, and is perfectly on theme. Plus, there are so many treats you can make.

Candy apples are one of the most popular Halloween snacks. To make them, melt some chocolate in a microwave or over a double boiler. Stir in some coconut oil for a glossy look and smoother consistency. Take your apples and dip them one by one in the melted chocolate. Cover it as much or as little as you want.

Then, add the toppings of your choice. You can go for chocolate chips, M&Ms, Oreos, pretzels, sprinkles — whatever you like! Finally, drizzle some gooey caramel on top. Allow it to harden before eating or just dive right in! It might be on the unhealthier side due to all the sweets, but it’s a fun and tasty Halloween treat.

 

4. Put Up Decorations

Halloween in COVID 19 times wouldn’t be complete without decorations. Give your house a spooky feel with fake cobwebs, carved pumpkins, fake skeletons, and witch silhouettes against your windows. You can also take your family for a drive through the entire neighborhood to view all the decorated houses.

Don’t forget to decorate the inside of your house, too. Even something simple like cutouts of bats and spiders can get your kids in the mood for Halloween. You can buy a lot of these decorations for cheap online. Alternatively, you can also make your own decorations with colorful paper and some scissors. Kids will love it!

 

5. Trick-or-Treat… from a Distance

What’s Halloween without some trick-or-treating? It’s a long-standing tradition that kids all around the country love. And what’s not to like? They get to dress up in costumes and ask for candy from neighbors.

With COVID 19 easily transmitted through respiratory droplets, though, HOA residents should take extra caution. If your city or town allows trick-or-treating, consider imposing stricter guidelines for residents to follow.

Remind everyone to wear their face masks and practice social distancing at all times. Ask residents not to personally give away candy. Instead, encourage them to leave a bowl of candy by their door along with a hand sanitizer dispenser. Ask them to post signs reminding trick-or-treaters to sanitize their hands first before getting a handful of treats.

Alternatively, residents can opt to place individual goodie bags in their driveway. Trick-or-treaters can then just grab one and move on to the next house. These Halloween COVID 19 trick-or-treat ideas can make the activity a lot safer for everyone.

 

6. Schedule a Movie Night

Another community-wide event your HOA can host is a scary movie night. You can watch movies online together using third-party services like Netflix Party. You can even organize a post-movie online discussion where residents can express their thoughts and even make new friends.

Residents can also schedule their own movie nights with friends and family. If children will be watching, too, though, make sure to choose your movie wisely. Kids tend to scare easily, so go for a family-friendly flick that everyone can enjoy. “Toy Story of Terror,” ‘The Nightmare Before Christmas,” and “Monsters Inc.” come to mind.

 

7. Take the Fun Outside

Although it’s better to stay home, there are some outdoor Halloween activities you can participate in as well. A visit to an apple orchard or pumpkin patch can bring smiles to your kids’ faces. You can also go to a haunted forest or a corn maze. Just remember to pack hand sanitizer, wear your face masks, and practice proper social distancing.

Of course, you don’t have to go too far to enjoy an outdoor activity. Simply camping in your backyard can be a fun experience. You can sleep in a tent, make shadow puppets, and play flashlight tag. Don’t start a campfire, though, as that can quickly grow out of control. If you want to make smores, you can prepare them beforehand in an oven or microwave.

 

Halloween and COVID 19: Make Safety a Priority

Don’t let the coronavirus pandemic dampen your Halloween spirit. You can still have some fun with your family and stay safe at the same time. Similarly, HOAs can still foster a sense of community even during these trying times. Choose from these great Halloween COVID 19 ideas or try them all!

 

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What Exactly Are The Code Of Ethics For HOA Board Members?

Board members should serve their homeowners association in an honest and steadfast manner. Not everyone has the same idea of how to do this, though, especially when conflicts and ethical dilemmas come up. This is why it is important to craft your own code of ethics for HOA board members.

 

Creating a Code of Ethics for HOA Board Members

A code of ethics, also known as a code of conduct, is more than just a set of guidelines. The HOA board member code of conduct outlines the core principles you must honor and lets you know when you are outside the line of propriety. It gives you a standard that you can use to compare actions and behaviors against. After all, board members are only volunteers who sometimes feel unsure how to handle certain situations.

Beyond that, a code of ethics allows your board to maintain decorum as well as the appearance of it. Even the slightest hint of misconduct from the outside can drive an angry mob of homeowners. Abiding by a code of ethics will not only protect your board and the HOA, but it will also give homeowners peace of mind.

When writing your own HOA or condo board of directors code of ethics, consider including the following:

 

Commit Yourself to the HOA

In many ways, serving on the HOA board is just like a job. It requires your time and commitment. Thus, if you accept the position, you should be prepared to devote a portion of your schedule to the association. That means juggling board member duties with your other responsibilities, attending all the board meetings, and just generally prioritizing your service to the HOA above all else.

 

Follow Your Governing Documents and Applicable Laws

 condo board of directors code of ethicsBoard membership requires understanding and complying with your HOA’s governing documents, and your HOA board of directors code of conduct should reflect that. Make sure to always follow the provisions set forth within your bylaws and CC&Rs as well as any relevant federal and state laws.

Remember that other members of the community look to you for guidance. If you disregard the rules, then members will think they can do the same. As a board member, you don’t receive special treatment. In fact, there is more pressure on you to follow the rules because you should set a good example for everyone else.

 

Disclose and Avoid Conflicts of Interest

Conflicts of interest will inevitably arise within your HOA board. Let’s say your HOA is looking for a new landscaper and your cousin happens to run a landscaping business. To avoid this HOA board of directors conflict of interest, you should remove your cousin’s company from the list of candidates.

When should a HOA board member recuse themselves?

Sometimes, when you have very few options, you are forced to consider your cousin’s company. This usually happens to HOAs in small towns or cities where the options are few and far between. In that case, if you do allow your cousin’s company to join the race, you should disclose the conflict of interest and then recuse yourself from the discussion and subsequent vote. If you do recuse yourself, make sure the board meeting minutes reflect that.

 

Practice Confidentiality

As a board member, there are certain details that only you and your fellow board members are privy to. Therefore, your code of ethics should require you to maintain HOA board member confidentiality. That means you should never discuss these matters outside the executive session of your board meetings. Examples of confidential matters include litigation proceedings between the HOA and an owner, delinquent accounts, disciplinary hearings, etc.

 

Never Discriminate

hoa board member code of conductDiscrimination in any form is never acceptable, and your HOA board member code of ethics should make that clear. This includes discriminating against homeowners or board members because of their race, color, sex, religion, and other classes outlined within the federal Fair Housing Act and state Fair Housing laws.

Your homeowners association should promote inclusivity and shun any type of bias. This will allow you to cultivate a more harmonious environment. Any board member who exhibits any kind of discriminatory conduct must be immediately removed from the HOA board.

 

Exhibit Professional Behavior

Professionalism and respectfulness should be the norm for your HOA board. You must always treat your fellow homeowners and board members with utmost respect and courtesy. Many problems arise just out of the way people treat or speak to each other.

If you want to have a successful board, you must encourage open dialogue between your board and the community’s residents. This also extends to the people your association works with, including but not limited to your HOA manager, attorney, accountant, vendors, employees, and the like.

 

Always Work Within the HOA’s Structure

Many boards make the mistake of discussing association business outside of board meetings. They might do this to get more work done or in an attempt to exclude certain board members from the vote. But, this type of practice is completely inappropriate and even goes against the law in some states.

You should only talk about and vote on HOA matters during board meetings after giving sufficient notice and establishing a quorum. Additionally, the board works as a unit and should maintain a united front even if not everyone agrees with the decision that ultimately passes.

 

Select Contractors According to a Standard

Your HOA will need to hire professional contractors to perform various services in the community. To avoid giving the impression of dishonesty or corruption, your board should follow a standard procedure for the contractor selection process. That means obtaining competitive bids, comparing fee structures, and doing your due diligence. Remember that you are bound by your code of ethics for HOA board members as well as your governing documents.

 

Communicate

hoa code of ethicsHomeowners association management is not a dictatorship. You might be a board member, but that does not mean you can disregard the opinions of other members of your community. In fact, seeking input from homeowners is one of the best ways you can successfully run the HOA and keep everyone happy.

Additionally, it is imperative that you communicate the HOA board code of ethics with all homeowners. In doing so, you are showing them that you value and practice transparency and accountability. This, in turn, will foster trust between the board and its constituents.

 

Sample HOA Code of Ethics

No two associations are made equal, so your code of ethics may not consist of similar ethical standards as your neighboring HOA’s. Although such codes may differ in language, they should contain the same basic core principles. Below is an example of a code of ethics for HOA board members.

Board members must:

  • Move within the scope of their authority as determined by the law and the association’s governing documents.
  • Always endeavor to serve the association’s best interests and put their own personal interests aside.
  • Carry out their responsibilities with impartiality.
  • Make decisions for the association using sound judgment and due diligence.
  • Disclose any potential conflicts or interest and recuse themselves from the discussion and vote in case one exists.
  • Allow community members the chance to voice their opinions on association matters.
  • Always support the decisions made as a board even if they do not necessarily agree with them.
  • Hold open, honest, and fair elections.

Board members must not:

  • Support or promote any activity, action, or behavior that breaches the law or other regulatory requirement.
  • Disclose confidential information to any party outside of the board unless given authorization to do so.
  • Share to any third party any discussions or decisions made in the executive session of board meetings.
  • Reveal personal information about any homeowner, resident, or employee.
  • Use association funds for personal use without authorization.
  • Exploit their position as a board member for personal gain.
  • Directly or indirectly accept gifts from members of the community, suppliers, or contractors.
  • Misreport or conceal facts concerning the association.
  • Threaten, intimidate, or harass any board member, homeowner, resident, contractor, or employee.
  • Make any promises to a bidder or contractor.

 

A Better Community for All

Every HOA community should have a code of ethics for HOA board members to follow. This ensures that board members will act with good intentions, in all honesty, and within the association’s best interests. It also helps eliminate or reduce any trust issues or suspicions that homeowners may have about your board.

Finding the right HOA management company or vendors can be tough. Start your search for the best one in your area today with the help of our online directory.

 

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Should You Live In A Deed Restricted Community?

There are a number of critical steps you must take before buying a home, and one of those is to find out whether the property belongs in a deed-restricted neighborhood. But, what is a deed-restricted community anyway? And how does it affect you as a potential homeowner?

 

What Does It Mean to Live in a Deed-Restricted Community?

What does deed-restricted community mean? To put it plainly, a deed-restricted community is a complex or development where homeowners can’t do certain actions. Such communities are typically governed by a private entity known as homeowners associations. These associations follow a set of governing documents, which includes the Declaration of Covenants, Conditions, & Restrictions (CC&Rs).

What is a deed restriction? Otherwise known as restrictive covenants in HOAs, these are agreements that limit or prohibit certain activities typically involving the property use, maintenance, and appearance. So, what does it mean when a property is deed-restricted? Simply put, it means you must adhere to certain rules and covenants restricting how you use that property.

Deed restrictions typically run with the land. That means they are attached to the land itself and not the home on top of it. Many deed restrictions also come from homeowners associations. For this article, we will be focusing on the HOA deed restrictions.

 

Common Deed Restrictions in HOAs

hoa deed restrictionsWhat is an example of a deed restriction? Although deed restrictions are very common in HOA communities, not all associations have the same exact set. Some of the most common restrictive covenants you might come across, though, include but are not limited to:

  • The exterior appearance of your property such as what paint colors and finishes you can use, doors you can install, etc.
  • Structural additions or modifications to your property such as sheds, greenhouses, balconies, pools, etc.
  • Fencing requirements and limitations
  • Vehicle parking such as where you can park, what type of vehicles you can park in your driveway or street, etc.
  • Landscaping requirements and limitations
  • Hanging your laundry out to dry*
  • Satellite dish, antenna, or solar panel installations*
  • Custom mailbox designs
  • Prohibiting or regulating the use of your property as a business
  • Pet policies such as how many pets you can have, what types, and what breed
  • Age restrictions such as only allowing residents 55 years or older
  • Placement of trash cans

*In some states, HOAs cannot prohibit homeowners from solar drying and the installation of satellites, antennas, and solar panels. Though, they may be able to regulate them.

 

Pros and Cons of a Deed-Restricted Community

Living in a community with deed restrictions obviously has both advantages and disadvantages. As a potential homeowner, you need to weigh these two against each other to determine whether or not living in a deed-restricted community is right for you.

 

Benefits of a Deed-Restricted Community

Here are the benefits of living in a community with HOA deed restrictions:

  • Access to Amenities. Many deed-restricted communities come with several amenities and facilities that members can use. This can include pools, gyms, parks, and clubhouses. Access to these amenities is usually reserved for members only.
  • Dispute Resolution. When you get into a spat with your neighbor, homeowners associations can step in and help with dispute resolution. Deed restrictions also mean that you won’t have to worry about your neighbor painting their house bright neon pink or their overhanging trees creeping on your property line.
  • Maintenance. No time for landscaping maintenance or snow removal? Some associations provide such services as part of your monthly membership dues. Continuous maintenance of common areas can also lead to better aesthetics.
  • Curb Appeal. One of the reasons deed restrictions exist is to facilitate uniformity. Even though the houses in the neighborhood more or less look the same way, consistency does enhance curb appeal.
  • Property Values. All of the above benefits are great on their own. But, when you put them all together, it can lead to improved property values. And isn’t that what you want as a homeowner?

 

Drawbacks of a Deed-Restricted Community

Here are the drawbacks of living in a community with HOA restrictions:

  • Limited Freedom. Because of restrictive covenants, you generally have limited freedom when it comes to how you can use or change your property. Some associations also require homeowners to mow their lawns and trim their trees on a regular basis, though it usually depends on what services the HOA provides.
  • Monthly Dues. Homeowners who live in deed-restricted communities must pay monthly dues. These dues go straight to paying for the various expenses related to maintaining the community. Over time, these dues can increase, though there are certain limitations on how much associations can raise dues by every year.
  • Potential for Consequences. To encourage compliance and prevent violations, HOAs do impose penalties — monetary or otherwise — when homeowners go against deed restrictions. In some cases, associations can even foreclose on your home.
  • More Difficult to Sell. There are a couple of reasons why it would be harder for you to sell a deed-restricted property. First, people don’t tend to like it when they have limited freedom, so they are less likely to consider buying homes with deed restrictions. Second, some restrictions might limit your pool of potential buyers. For instance, if your HOA has age restrictions, that means you can only sell to people of a certain age.

 

Are Deed-Restricted Communities Worth It?

Homeowners tend to place significance on HOA dues more than anything else. After all, agreeing to live in an HOA community means having to pay these dues for as long as you are a member. If you stay for the next decade and need to pay $300 every month, that equates to $36,000 — and that doesn’t even factor in dues increases (which are practically inevitable).

All things considered, are HOA fees worth it? Most people would say yes. Thanks to regular neighborhood maintenance, homes in HOA communities are likelier to maintain their value over a longer period of time. Additionally, like it or not, the way your neighbor’s house looks can also affect the value of your home. When you examine the pros and cons, the former definitely outweighs the latter.

 

Who Creates Deed Restrictions on a Property?

Within the context of HOAs, the developer of the planned community usually establishes the first deed restrictions. After control is passed on to the homeowners association, more deed restrictions can then be created and added to the governing documents. Creating and amending deed restrictions, though, usually involves a lot of work.

The HOA board will first need to review and discuss a proposal of the addition or change. Homeowners can also provide their input during the meeting. Then, voting takes place. For many associations, passing an amendment requires a majority vote from the entire membership. This process can vary, though, from association to association. To learn more about your guidelines for amending deed restrictions, check your governing documents.

 

How Do I Find Deed Restrictions on My Property?

Some homeowners live for years on end without knowing their property is deed-restricted. This is why it is important to learn how to find deed restrictions on a property.

Such restrictions should appear within your property’s deed. If you can’t find your deed, you can ask for a copy of it from the recorder’s office where it was first filed. The process for how to find out deed restrictions can often take a long time, though, since they usually consist of hundreds of pages.

If you have yet to buy a home and wish to find out whether it is deed-restricted, your first course of action should be to check with your real estate agent. You can also conduct a title search or speak directly with the HOA as many deed restrictions do come from these associations.

 

Who Enforces a Deed Restriction?

The body that enforces deed restrictions is usually the body that created them in the first place. It may be the local government or the developer of the property. Who enforces deed restrictions in an HOA? If the property belongs in an HOA community, the HOA enforces the deed restrictions.

The HOA usually enforces deed restrictions by conducting regular inspections of the properties in the community. Since many restrictions have to do with architectural changes, HOAs usually have members follow an application and approval process. In larger associations, there are Architectural Control Committees that handle this type of thing.

 

What Happens If You Don’t Follow Deed Restrictions?

common deed restrictionsIn homeowners associations, when you fail to follow deed restrictions, it can lead to a number of possible consequences. These can differ depending on the HOA, though you can expect most to start with sending a notice of the violation. The HOA may also issue a fine against you after going through a disciplinary hearing.

Depending on state laws and the extent of the HOA’s authority, the association may also place a lien on your property. This will make it difficult for you to sell your home, especially when you have unpaid fees. Some associations can even foreclose on the lien.

What happens if you break a deed restriction in a non-HOA environment? Typically, the developer will initiate a lawsuit against the property owner. Lawsuits can be very expensive. Moreover, if you lose, you might have to pay for the developer’s legal fees as well.

 

How to Fight Deed Restrictions

How do I get around deed restrictions? Short of selling the property and moving out, there is really nothing you can do to fight deed restrictions. In HOAs, you may be able to change deed restrictions by going through the process spelled out within the governing documents.

But, there are certain exceptions. Some deed restrictions may not be enforceable if they are illegal, unreasonable, or outdated. Discriminatory deed restrictions, for one, are downright unconstitutional. The Fair Housing Act and state Fair Housing laws protect certain classes of individuals. For instance, a deed restriction that says you can’t sell the property to non-whites is illegal and unenforceable.

Make sure to check federal and state laws to ensure the deed restrictions on your property are legal and enforceable. Similarly, HOAs should remain up-to-date on these laws to avoid potential liability.

 

How Long Are Deed Restrictions Good For?

Deed restrictions can vary in terms of lifespan. Some only go on for 25 to 30 years, while others can last 30 to 45 years. Certain deed restrictions also restart the clock every time the property changes ownership. There are even deed restrictions that exist in perpetuity, meaning they have no expiry date.

When deed restrictions expire, they are no longer enforceable. In homeowners associations, though, there are cases where deed restrictions can be reinstated after expiry. This usually requires a majority vote from the membership, but it really all comes down to what it says in your governing documents.

 

The Rising Popularity of Deed-Restricted Communities

More and more people are choosing to buy homes in a deed-restricted community. Considering the benefits of such properties, this growing popularity does not come as much of a surprise. Although some HOA fees can be quite expensive, there is no denying that they come with a lot of perks in exchange. If you think of deed restrictions as guidelines to help boost property value, then they are definitely worth it.

Most deed-restricted communities are run by a set of board members with the help of an HOA management company. Our online directory makes it easy to look for management companies and vendors in your area. Start using it today!

 

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What Is An HOA Tax Return? What’s The Process For Filing?

Tax season is always stressful, especially for homeowners associations with no experience on the subject. But, filing your HOA tax return does not have to be an uphill battle.

 

HOA Tax Return: Is It Necessary?

Does an HOA have to file a tax return? There is a common misconception that HOAs do not need to file tax returns, and a lot of people still believe it to this day. This fallacy primarily stems from the notion that, since HOAs are non-profit entities, tax returns are unnecessary.

But, the truth is homeowners associations do pay taxes and are therefore required to file tax returns. Although it is true that such associations are non-profit, the Internal Revenue Services does not treat them that way. This applies even if your HOA is registered and officially designated as a non-profit organization in your state.

Since an HOA’s main purpose is not to make money, you will find that most of the income your HOA generates is tax-exempt. That means you do not have much in terms of tax liability. Even if your HOA’s entire income is exempt from taxation, though, you will still need to file a homeowners association tax return annually.

 

Two Types of Homeowners Association Tax Form

form 1120 | hoa tax returnUnlike other kinds of organizations, homeowners associations are allowed more flexibility by the IRS. In fact, there are two types of forms you can use for HOA tax filing: Form 1120 and Form 1120-H.

But, how exactly do these two forms differ?

Form 1120, also known as the Corporation Income Tax Return form, is the one traditional corporations use. Before the introduction of Form 1120-H, the IRS required HOAs to use Form 1120. But, many associations dislike this form for a couple of reasons.

  • Labor-intensive. Form 1120 objectively involves more work, so it is both time-consuming and troublesome to file. It demands a large amount of detailed information that most associations just do not have. To file Form 1120, associations would have to keep their books in an advanced manner. This makes it significantly harder for the HOA treasurer, who must also manage to make estimated tax payments.
  • Taxable leftover income. If you choose to file Form 1120, that would make any income your association does not spend for the year taxable. This applies even if you deposit the surplus in your reserve fund.

In contrast, Form 1120-H is much easier to file because the IRS specifically designed it for homeowners associations. Compared to the multi-paged Form 1120, Form 1120-H only consists of one page, making it significantly less labor-intensive.

It is worth noting that the IRS allows HOAs to choose between Form 1120 and 1120-H every year. That means you can file Form 1120 one year and then Form 1120H the next. You do not have to stick to a single form forever. This gives you the unique opportunity of calculating how much tax you need to pay for each form and then using the one that demands the least tax amount.

 

Exempt vs Non-Exempt Income

While impatience might immediately push you to file your HOA tax returns, you must first understand how exempt and non-exempt income work. Failure to do so can lead to problems with your taxes and paying more taxes than required.

What is exempt function income? Often simply referred to as exempt income, this type of income comes in the form of membership dues, special assessments, fines or fees, and any interest. Exempt income must be sourced solely from the association’s members acting as owners and not as the HOA’s customers.

What is non-exempt function income? Non-exempt income is the income your HOA earns through providing services to association members or the public. Some common examples of non-exempt income for an HOA would be income earned by vending machines, laundry services, and facility rentals.

As a general rule, exempt income is not taxable and non-exempt income is taxable. Some cases allow for certain exceptions to this rule. But, since it varies depending on the case, it is best to have a professional or accountant review your homeowner association taxes before filing.

 

Understanding Non-Exempt Expenses

If you have non-exempt income, you are then given the opportunity to deduct any expenses that directly relate to the creation of that income. But, you might have expenses that indirectly contributed to this non-exempt income. Can you then use these indirect costs to lower the amount of taxable income you have?

According to IRC Section 528, you can deduct a portion of any expenses your association used for maintenance, repair, construction, or management. This includes insurance expenses, accounting costs, tax fees, bank charges, and HOA management fees.

This is a double-edged sword, though. While this reduces your HOA’s taxable income, it also means that you might not qualify for Form 1120-H because it will negatively affect the 90 percent expense calculation (discussed below).

 

How to Qualify for Form 1120-H

Most homeowners associations opt to use Form 1120-H because it offers a lot of benefits. One of the biggest benefits of this form is that you can exclude exempt function income from your gross income. In essence, this means you will only need to pay taxes on non-exempt income. But, there are certain pre-requisites for an HOA to qualify for Form 1120-H.

According to IRC Section 528, your HOA can file Form 1120-H if you meet the following homeowners association tax filing requirements:

  • At least 60 percent of your association’s gross income for the tax year must consist of exempt income. This type of income typically comes from homeowners such as monthly dues, assessments, interest, and fines.
  • At least 90 percent of your association’s total expenses must be used for the acquiring, building, managing, maintaining, or caring of the association’s properties.
  • No private individual or shareholder must monetarily gain from the association’s net earnings except through acquiring, building, managing, maintaining, or caring for the association’s properties or through a refund of dues, assessments, or fees.

 

Form 1120-H Instructions: How to File It

You can easily download the necessary forms from the IRS website. Alternatively, you can place an order and have the service mail the forms to your association within 10 business days.

Once you have your forms ready, it is time to fill them up. Determine your exempt and non-exempt income amounts. Then, to calculate your tax amount, start by deducting $100 from your non-exempt income. The remainder of your non-exempt income will then be subject to a flat rate of 30 percent. For timeshare associations, the rate is set at 32 percent.

After filling out your form of choice, an authorized person will then need to sign it. This can be the board president, vice president, secretary, treasurer, accounting officer, etc. Finally, send your HOA tax return to the appropriate address.

 

Where to Mail Form 1120-H

Homeowners associations must mail their accomplished forms to the Department of the Treasury Internal Revenue Service Center. There are two addresses within the United States. The first is located in Kansas City, MO 64999-0012. You must mail your HOA tax return form to this address if you live in the following states:

  • West Virginia
  • Wisconsin
  • Ohio
  • Connecticut
  • Maryland
  • Illinois
  • New Jersey
  • Rhode Island
  • Maine
  • Michigan
  • Tennessee
  • Virginia
  • New Hampshire
  • North Carolina
  • District of Columbia
  • Kentucky
  • South Carolina
  • Massachusetts
  • Vermont
  • New York
  • Georgia
  • Pennsylvania
  • Indiana
  • Delaware

For the rest of the states, mail your tax return forms to the IRS center in Center Ogden, UT 84201-0012.

 

When to File HOA Tax Returns

Generally, the deadline for HOA tax return filing is on the 15th day of the 4th month following the conclusion of your tax year. But, if your association’s fiscal year closes on June 30, you must complete your tax return and file it by the 15th day of the 3rd month following the end of your tax year. The same goes for associations with short tax years that end any time in June.

If the deadline coincides with a holiday or a weekend (Saturday or Sunday), you may file your HOA tax return on the next business day.

 

Extension to File Form 1120-H

Given the complexity of filing a tax return for homeowners association communities, you are bound to experience a few bumps in the road. In that case, you can file for an extension with the IRS to give you more time. Keep in mind, though, that this extension only applies to the deadline for tax filing. You must still pay your taxes on time.

Homeowners associations can file an extension by accomplishing Form 7004 before the tax return deadline. This will give you an extra 6 months. It is worth noting that this extension does not need to undergo an approval process. Your extension is automatically applied.

 

Homeowner Association Taxation FAQs

 

Does an HOA file a tax return?

Yes, homeowners associations do need to file tax returns. Even though HOAs are not-for-profit, the IRS still recognizes them as corporations.

 

What type of tax return does a homeowners association file?

Homeowners associations have a choice between two tax return forms: Form 1120 and Form 1120-H. Form 1120 is typically used by traditional corporations, whereas Form 1120-H was designed with HOAs in mind. Many HOAs prefer to use Form 1120-H because it poses more benefits and is easier to accomplish.

 

What happens if HOA does not file taxes?

If an HOA never filed tax return or missed a few years, it can still remedy the situation. What you must do is look for your most recent tax filing and determine how many years have passed since. Then, contact IRS to ask them if you can file Form 1120-H for the years you skipped.

 

Who must file form 1120 H?

Form 1120-H is reserved for homeowners associations, though such associations can choose to file Form 1120 instead. Typically, the board or the HOA’s accountant accomplishes this form. An authorized person will then need to sign the form before mailing it to the IRS.

 

Can Form 1120-H be filed electronically?

As of now, the IRS does not allow homeowners associations to file Form 1120-H electronically. Depending on where your HOA is located, you must accomplish the form and then send it to the Department of Treasury Internal Revenue Service Center either in Kansas City, MO or Ogden, UT.

 

Can HOA be tax exempt?

Generally speaking, HOAs are not tax-exempt organizations, even if they are non-profit. But, there are ways to qualify for federal or state tax exemption. For federal tax exemption, associations must make 501(c)(4) or 501(c)(7) status, though accomplish either one is very difficult and rare. For state tax exemption, you must check your state laws.

 

Does an HOA need a tax ID number?

Yes, homeowners associations do need a federal tax ID number, often referred to as an Employee Identification Number (EIN). You will typically need this number when filling out tax forms or other forms. To acquire a tax ID number for your HOA, call the IRS or visit their website.

 

Getting the Lowest Tax for Your HOA

homeowners association tax returnWhen it comes to HOA tax returns, Form 1120-H clearly trumps Form 1120 in many ways. But, there are some instances when Form 1120 might result in lower taxes for your association. To get the lowest possible tax liability, it is best practice to compute for both Form 1120 and Form 1120-H, then go with the one that requires you to pay a lower amount.

Many HOA management companies offer help with HOA taxes. Begin your search for the right one in your area using our online directory.

 

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Should You Provide HOA Online Support?

Homeowners often have questions or concerns they would like to raise but have no medium to do so in an instant. This is why some HOAs are considering online support. But, is HOA online support even a good idea?

 

Is HOA Online Support Necessary?

In an HOA, it is only normal for residents to have questions and issues related to their property or the association at large. While some of these concerns can usually be raised during the annual meeting, not all homeowners get the opportunity to voice out their opinions.

In the past, before the advent of the internet, residents had to send in their concerns via hand-delivered letters. Thanks to technological advancements, more and more HOAs are adopting electronic methods of homeowner communication.

While many associations have websites in place, some have started to consider adding online chat support for homeowners. Although this is a noble and helpful undertaking, an HOA board should first consider whether the act is even worth exploring. So, should the board use HOA online support?

 

The Benefits of HOA Online Support

benefits | hoa email supportAdopting online HOA customer service has some obvious advantages. For instance, it is a service that adds further value to the experience of homeowners in the community.

Homeowners like knowing that their voices are being heard. In fact, they expect it. That is understandable considering they pay regular HOA dues in exchange for a certain level of service. By adding chat support, your HOA board will definitely see a rise in homeowner satisfaction rates.

Another benefit of using online chat support is convenience. Imagine homeowners being able to reach your HOA board in an instant, with a mode of communication right at their fingertips. Perhaps, in the middle of grocery shopping, they think of an idea that they believe will benefit the community.

All they need to do is take out their smartphone and send a chat message before they forget it. No more taking down notes for later and then not even remembering to tell the board about it.

Finally, adding online chat support encourages homeowners to confidently voice out their issues without fear of getting shot down. A lot of residents keep their opinions to themselves out of fear of confrontation.

Not everyone has the courage to bring up a concern that they feel personally affected by. With online support like chatting, your HOA board can open itself up to a world of new suggestions. After all, it is much easier to hide behind a screen.

 

The Perils of HOA Online Support

Like most things in life, HOA online support also has its drawbacks. If your HOA board decides to pursue the project using your own resources, it will take some time and effort — not to mention plenty of funds.

First of all, setting up your own chat support via a website requires a sizable budget. Web development does not come cheap. It will also take a while before you can launch the platform, seeing as it needs to undergo quality testing to make sure no bugs slip through the cracks.

Of course, you can always turn to existing mediums like Facebook or Twitter. While these can significantly reduce the amount of money required to set up chat support, you will still need personnel to constantly monitor these sites. Facebook has Messenger Bots you can try out.

That means either sacrificing much of your own time to answer messages or paying someone else to do it. Either way, it will take resources that smaller HOAs might not have.

Furthermore, not all boards want to be within reach all the time. Chat support implies a certain level of availability, and most board members simply do not have the extra time to devote to such a task.

 

HOA Management Online Support

Since setting up online chat support takes plenty of resources, some associations turn to HOA management companies for help. Most HOA management companies offer homeowner communication services as part of their package. These packages usually only include voice and email support.

There are also companies that offer HOA management online chat support where their own employees answer the questions and concerns of the associations they handle.

It is important to note, though, that not all HOA management companies offer chat services. If your HOA is particularly looking for one that offers it, make sure to ask about the service during the selection process. Perhaps you can even raise the possibility of including it in your package if it is not already there.

 

Alternatives to Chat Support

While online chat support does have its benefits, it is not the only mode of communication HOA boards can use to stay in touch with community members. Homeowners can always send emails, though the board runs the risk of getting bogged down by piles of emails. Some emails may also go straight to spam (always check your spam folder!).

Voice support is an equally viable option for associations. Homeowners can call in and voice out their concerns over the phone. Unlike chat support, though, voice calls imply a certain window of availability. Board members may only be able to answer calls during their free time. After all, board members are only volunteers and also have full-time jobs outside of the HOA.

As mentioned above, a lot of HOA management companies already offer HOA email support and voice support. Some even have text (SMS) support, which is similar to chat support in many ways. If your association can’t swing online chat support, then SMS is the next best thing.

 

Does Your HOA Need Chat Support?

chat support | hoa email supportIn the end, only you and your fellow board members can answer this important question. Every HOA is different, therefore, you may not have the same needs as others.

If you think voice and email support are enough, then perhaps it would be a waste to add a third avenue.

The HOA board must consider its options carefully, especially if it intends to pursue HOA online support without help from a management company. When deciding, remember to prioritize the needs of the association. Will this benefit the community or will it only serve as another waste of resources?

 

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