‘Easy’ condo/HOA living not without drawbacks
Article Courtesy of LOOP NORTH NEWS
By Don DeBat
Published October 30, 2015
A new national survey finds 72 percent of residents in community associations have been involved in a significant dispute with their association. 40 percent have filed a complaint with a state agency. 30 percent have filed a lawsuit. This is the first of two articles on community association living.
Another attraction of condo and HOA living is the hefty tax breaks. Federal and state tax deductions for mortgage interest and property taxes are handed to owners. Uncle Sam not only allows tax deductions for mortgage interest, but also allows home and condo owners to deduct the cost of real estate taxes.
However, the condo lifestyle isn’t always pretty. In 2010, a survey by Community Association Institute found that more than half of the nation’s HOAs were facing serious financial problems.
In 2013, Association Reserves, a California company that helps associations with budget and operational issues, noted that 72 percent of association-governed communities were under-funded, up from 59.5 percent a decade ago.
Now, a new national survey by Coalition for Community Housing Policy in the Public Interest (CHPPI) has found that 95 percent of community association residents feel that “lack of transparency” and “poor communication” was at least a moderate problem, while a shocking 84 percent felt that it was a very serious problem.
“Our survey, which rated the level of concern on 26 commonly reported issues, found that a broad spectrum – from voting and election procedures to power of the board to fine owners – were viewed as major problems within condo associations and HOAs by respondents,” said Sara Benson, a CHPPI board member and president of Association Evaluation, LLC, a Chicago-based real estate technology firm that rates condo and homeowner associations.
“An overwhelming 93 percent of survey respondents felt there is at least a moderate problem within their condo or HOA’s power of the board to issue fines,” noted housing advocate Deborah Cassano Goonan, a CHPPI board member based in Florida.
More than 300 owners residing in condominium and HOA communities in Illinois, Arizona, California, Florida, Nevada, Texas, and a host of other states responded to the survey.
Other findings of the CHPPI survey...
On the future of community associations, nearly half of all respondents said that HOAs “need to be significantly reformed” and 25 percent feel that HOAs “need to be abolished or phased out of existence.”