Reporter Jay Root has written a long exposé of the HOA industrial complex. He focuses on Texas State Senator John Carona, who heads up a large property management company that stands behind thousands of HOA's. The lead-in and conclusion feature one of my clients, a homeowner getting foreclosed on by the Brookfield HOA in Pflugerville, Texas for bogus fines that spiraled into thousands of dollars of handling charges and attorney's fees. My client, Shawn Riggs, got mad and hired me, and then Jay Root got hold of the story. The main focus of the article is about Senator Carona's empire building in the HOA field while serving in the Texas Legislature. The HOA abuse featured in the article doesn't surprise me, but the machinations behind the scenes does. I strongly recommend that anyone planning to buy into an HOA community read this article. Read More...

Tags: brookfield hoa, brookfield owners association, brookfield pflugerville, jay root, Texas Monthly hoa article

If you're planning to buy a home in a subdivision, or a condo in a condo association, you should budget $250-$500 to sit down with me to talk about what you're getting into. I do a review of the HOA governing documents first, then sit down with you to discuss what living in an HOA generally, and the proposed HOA specifically, may be like. I have noticed that most people who hire me to do this end up looking for a different house -- either one not in an HOA, or else one in an HOA without much power.

Vested interests in the real estate brokerage industry aren't all that interested in making sure buyers know the risks of buying into an HOA. Sellers certainly don't want to tell you how awful their HOA may be. I have no such vested interest -- in fact, the reverse, since a large part of my practice is HOA litigation in which I represent homeowners. Trust me, you don't want to get involved with that! Read More...

On February 26, 2013, following a December 2012 jury trial, the Travis County District Court entered judgment in favor of my client, Marvin William Hays, as against Briarcliff Property Owners Association, invalidating the HOA's short-term rental ban and awarding $40,000 in attorney's fees plus costs of suit to Hays. The final judgment is here. The final judgment incorporates the summary judgment orders earlier in the case that invalidated the rental ban.

The trial itself, which was over issues the HOA asserted after its rental ban got invalidated as a matter of law, focused on whether Hays had ever rented to "non single families" -- for any term, short or long. Hays had conceded at trial that he had not tried to determine whether and how his renters were related (for example, by blood, marriage, adoption, etc.) since the HOA had never bothered to regulate rentals of any kind prior to March 2011, when it issued its ban on all short-term rentals. Thus, the HOA won $2,400 in fines at trial, reflecting a jury finding of 12 days of non-single-family rentals in 2009 and 2010.

The HOA spent around $150,000 to obtain $2400 in fines, even though its short-term rental ban went by the wayside entirely. The central purpose of its lawsuit against homeowner Hays failed.

What does "single family" mean? No one knows, really -- the jury wasn't asked to decide that, and the judge didn't impose a definition for the jury to use. I address that issue in a separate blog entry.

In March 2013, the Village of Briarcliff enacted short term rental regulations addressing the kinds of concerns residents had about STR's. The HOA is a subset of the Village, and the city ordinances apply to everyone. STR's are allowed but restricted, as in many communities. Read More...

Tags: briarcliff hoa

On June 14, 2012, a judge in Travis County, Texas clarified a prior grant of summary judgment in favor of my client on the issue of short-term rentals. Under a basic grant of the leasing right under a subdivision declaration, the trial court ruled that whole-house rentals to one family at a time are a residential use, not a business use. The clarification of the prior order completely guts an HOA's attempt to take away both short term and long-term rental rights from owners of the subdivision. Read More...

Tags: homeaway, briarcliff hoa

Two very recent cases bolster the other extant cases in holding, uniformly, that a homeowner's engaging in short-term rentals with a residential dwelling house is not a "business or commercial use" under typical, basic HOA wording that grants express leasing rights but does not otherwise regulate leasing. Typically, the only restriction found in declarations -- especially older ones that HOA's haven't amended -- is for "business or commercial uses." That's a common municipal ordinance restriction too. With the rise of HomeAway, VRBO, and other rental and home-sharing sites, short-term renting is a contentious issue. The problem in the HOA context is that many declarations are simply silent as to any leasing restrictions, leading the average homeowner to believe he or she has an untrammeled right to lease out a home for whatever term, short or long, so long as the renters aren't causing problems. If an HOA declaration is silent, an HOA needs to amend its declarations to address the issue. A silent declaration does not allow an HOA to take away rental rights. Read More...

Tags: homeaway, vrbo

I have posted the chief pleadings and briefs in Briarcliff Property Owners Association, Inc. v. Marvin William Hays, Jr., Cause No. D-1-GN-11-002233 (Travis County 98th Judicial District) so that others interested in the short-term rental issue may benefit from all the arguments made in that case.

The court invalidated the Briarcliff HOA's short-term rental ban on March 14, 2012, but the HOA continues in its lawsuit against one homeowner. Read More...

Tags: homeaway, vrbo, short-term rentals

In a clear victory for homeowners and property rights, a Travis County court has rejected an HOA ban on short-term rentals. Briarcliff Property Owners Association, Inc. v. Marvin William Hays, Jr., Cause No. D-1-GN-11-002233 (Order of March 14, 2012). Read More...

Tags: short-term rental

HOA's Boards are unilaterally deciding to clamp down on short-term rentals even when the governing documents don't allow that or the HOA has been allowing such rentals for years or even decades. There are good defenses and counterclaims to such suits. Read More...

Tags: vacation home,homeaway,vrbo,short-term rentals

Where the filed condo declaration explicitly granted owners the right to lease, and a condo board enacted a rule that denied 70% of unit owners that right by means of a "lease cap," an arbitrator has declared the rules inapplicable to plaintiffs, who purchased prior to the effective date of the lease cap. The arbitrator's award states that amendment to the declaration is required to impose a lease cap. Read More...

Tags: lease cap

Some downtown Austin condos assert they can impose leasing caps without getting a super-majority of owners to amend the filed declarations. Their arguments don't stand up to scrutiny. Read More...

Tags: leasing cap, lease cap, condo leasing cap, condo lease cap, downtown austin condo leasing, downtown austin condo bylaws, downtown austin condo leasing rules

HOA's often forbid "commercial" activities or "non-residential" activities. The new reality of the internet-connected world is that home-based business are important to the new economy, can be compatible with the residential character of a neighborhood, are usually lower-impact on the environment, and offer new freedoms for individuals. HOA's need to re-think their approach to this issue and stop bludgeoning homeowners with lawsuits that threaten their livelihoods. Read More...

Tags: residential uses, commercial activities, non-residential uses, non-residential activities, home-based businesses

Under Texas HOA law, the one sure winner in every dispute is the lawyers. One particular provision of the Texas Real Estate Code is particularly pernicious in driving HOA's and homeowners into litigation. Say it ain't so, Texas Legislature! Read More...

Tags: fee-shifting, Attorney's fees

The governing documents (CC&R's -- covenants, conditions, and restrictions) and governing laws for the running of homeowners associations (HOA's) are too legalistic, abstruse, and technical for non-lawyers (i.e., your neighbors) to understand and enforce. That's why lawyers and property managers are getting rich at the expense of homeowners stuck with HOA's. We elect local governments and hire local officials to handle the complexities of property rights. HOA's should handle parties, beautification, and gripe sessions, not foreclosures and restrictions on others' freedoms. Read More...

HOA's are scary, and their trade group is even scarier. Read More...

Tags: homeowner rights