Texas HOAs: What to Know Before you Buy

If you’re buying or selling a condominium, a property in a subdivision or a town house in Texas, you have specific rights and responsibilities to consider in relation to your Homeowners Association (HOA). These organizations wield considerable power to apply regulations and even foreclose on a home. Here’s what you need to know about the Texas HOA and Texas HOA laws.

What is a Homeowners Association?

HOAs are common in every state, not just in Texas, and provide a means for protecting the character, quality and value of a particular neighborhood, community or shared building. The most common types are Condominium Associations and Subdivision Associations. In both these cases, the HOA regulates and manages the shared areas, such as the gardens, parks, courtyards and parking lots, but owners retain responsibility for their individual unit. Although HOAs are not regulated by the state in Texas, they have far-reaching powers and can apply regulations on anything from lemonade stands to firearms.

Typical HOA fees, rules and bylaws in Texas

As set out in their bylaws, HOAs can enforce Covenants, Conditions and Restrictions (CC&Rs) for association members. Crucially, these apply to the property and not the owner, so they could still be in effect if you are buying a property that is covered by an HOA.

Know the rules for your HOA

The bylaws of your HOA will usually anticipate and regulate the areas that most often give rise to disputes between owners in a shared community, so there are certainly benefits to being part of an HOA. Bylaws could set out parking regulations and noise restrictions, for example, but also set rules for acceptable exterior paint colors, maximum fence height, the positioning of satellite dishes and restrictions on pets.

Expect these fees

Homeowners Associations will collect fees from residents to cover the management and maintenance of shared areas, including:

  • Landscaping and maintenance.
  • Garbage collection.
  • Lighting.
  • Police patrol.
  • Insurance.

Usually, it will be the responsibility of the HOA to maintain property and general liability insurance, but owners should purchase additional insurance to cover improvements and personal property. These are the most common fees only, so inquire about any additional fees for your own particular HOA.

Understand the powers of your HOA

First of all, you cannot opt out of your property’s Homeowners Association. For the system to work effectively, membership is mandatory, as is the duty to resolve any lien-based charges the HOA levies. Even if you own your property free and clear, you will still have to pay regular assessments towards the Association, with serious consequences if you fall behind. Your HOA has the power to issue a Notice of Delinquent Assessment and can impose late charges or fees. If these are not paid, the Association can place liens on the property and apply for foreclosure. According to Texas law, these must be placed at county land records, so they will show up on any property title search, but outstanding liens can prevent a home being sold or a mortgage refinanced.

Your rights under Texas HOA laws

The powers of your HOA might seem substantial, but owners have a voice, too. The right of HOA members to attend HOA board meetings is enshrined in the Texas Property Code, chapters 82 and 209. There is, however, no automatic right to speak at these meetings.

Homeowners have these rights (and more):

  • Right to decorate your home with religious displays or flags up to a certain dimension.
  • Right to appeal fines.
  • Right to written notice prior to enforcement of any fines, liens or foreclosure.
  • Right to freedom from discrimination according to race, religion or political affiliation, for example, under the Fair Housing Act.

It’s worth pointing out that most members enjoy a harmonious relationship with their Association and see it as a useful tool for safeguarding the value of their property and community. If you’re unhappy, however, you cannot easily terminate a bad HOA. You’ll need to get approval from all owners, mortgage lenders and the local government to apply for dissolution.

Local Texas HOA laws and quirks

A number of laws govern HOAs in Texas, among which the key pieces of legislation are the Texas Property Code, Texas Condominium Act and Texas Debt Collection Act. However, state laws do not always apply statewide, but are often bracketed to designated locations, so it is important to familiarize yourself with your local laws.

Texas enacted significant HOA reforms in 2011, arguably tipping the balance of power in favor of owners rather than Associations. In particular:

  • HOAs no longer have the power to foreclose on properties without a judge (non-judicial foreclosure).
  • Owners have the right to install solar panels.
  • Owners who are delinquent on fees must be offered a payment plan before foreclosure proceedings can begin.
  • All Texas HOAs are required to hold open meetings and keep records, which must be made public.

If you’re buying or selling a property in Texas that may be subject to a Homeowners Association, your real estate agent is an essential source of local expertise on what laws, rules and fees may apply. It is also worth consulting a legal practice that specializes in Property Owners Association Law.

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