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Be Careful What You Sign – Many Old Home Owner’s Agreements Could Limit Your Choices

Original Comment:

If you are considering moving into a neighborhood that requires you to join a homeowner’s association and pay fees, make sure you are aware of all the terms. HOAs exist to help protect the property owner’s investment and to set forth the rules for what is and is not acceptable for your home and neighborhood.

Common HOA terms include prohibiting or requiring pre-approval before installing a privacy fence, setting forth certain design elements for your home including roof pitch and orientation to the site, and the fees for upkeep of the common areas.

In some cases, particularly with older HOAs, the language in the agreement is years or even decades old and may contain restrictions that seem completely irrelevant today.

As we have found on more than one occasion, it was not uncommon in the 1980s-90s for modular homes to be prohibited by the HOA. Often this was based on a misunderstanding that modular homes were the same as manufactured housing, which the drafters of the agreement felt would lower nearby home values.

In other cases, the restriction against modular homes was simply because the developer was the contractor or had an existing relationship with a site builder.

For whatever reason they exist, if you sign it, you are agreeing to those terms and limiting your choice on who builds your home and how you build it.

MHBA is currently involved in a lawsuit that is pending before the Michigan State Supreme Court where the homeowner received state approval for a modular home as well as a local permit. But once the home was constructed, installed, and occupied, another resident in the HOA pointed out that the home was modular, and the agreement prohibited any such homes deemed to be “modular.” The home itself is over 3,000 square feet and for all practical purposes, matches the quality, aesthetics, and size of neighboring homes. But the homeowner signed the HOA.

MHBA filed a friend of the court Amicus Brief on behalf of the homeowner in hopes of a ruling that will not only help the family, but also put an end to dated perceptions and restrictions on how consumers choose to build their homes.

Started on October 17, 2018 by Tom Hardiman

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