Property Management Professionals (PMP)

How far can a homeowners association go

Dr. HOA,

We lease our property and have tenants that moved in a few years ago with a husband, wife and kids. At some point, the wife and kids moved out and another man moved in. When the lease was up, we renewed the lease to the two men.

A few months ago, we received a letter from the HOA stating we could only lease to a “single family” (I have included the excerpt from my homeowners association’s conditions, covenants and restrictions agreement pertaining to this issue at the end of my letter).

We tried to convince the HOA to make an exception. The renters were good neighbors, and we even got the next-door neighbor to acknowledge this fact, but the HOA would not make an exception. Reluctantly, we gave the renters 60-days notice. The renters hired a lawyer and contacted us and the HOA, stating that the single family rule was in violation of the fair housing act.

We would like to let the renters stay, but are concerned about the fines the HOA can impose ($400 per day). Can a HOA enforce a rule like that? If we kick the renters out, we might get sued. If we let them stay, we get fined by the HOA. What would you advice? — Ken R.

Article VII: Use restrictions
Section 1. Single family residential. Each Lot shall be improved, used and occupied for private, single-family dwelling purposes only. Consistent with section 6 of this article, no part of any lot shall be used for commercial purposes. 

Dear Ken,

My professional opinion is that the association has no right to attempt to define what constitutes a “single family.” Additionally, the article and section referenced, specifically Article VII, Section 1, is being misused. This section simply means that your home is a single-family home, as opposed to a multifamily home (condominium), and that it cannot be used for commercial purposes.

In no way is this section of the CC&Rs meant to try to define who is permitted to live in the community. Even if your association’s CC&Rs specifically attempted to define individuals or families permitted to live in the community, state and federal Laws take precedence over the community’s governing documents, and this type of discriminatory rule would be in direct conflict with the Fair Housing Act, as well as several state laws, and therefore illegal.

I would advise you not serve your tenants notice and to request that the association’s attorney put this position in writing. My guess is that the association’s board of directors has not shared its position or actions with the association’s legal counsel. I am confident that once the board of directors speaks with their attorney, this issue will be dropped — like a hot potato.

If your board of directors is unwilling to have the association’s attorney draft a letter backing the board’s position, I would suggest you speak with an attorney before you are personally named in a lawsuit. I would be more than happy to recommend a real estate attorney who would eagerly take this case.

It concerns me when I hear stories of association board members over-reaching in their authority to govern a community, or exposing a community to unnecessary liability due to their lack of knowledge of the law or misinterpretation of the association’s governing documents.

By proactively seeking the advice of professional management or the association’s legal counsel, board members could avoid these types of misunderstandings, thereby mitigating liability to the association.

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