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Homeowner Associations and the Law in Arizona By K. Michelle Lind Posted: April 2000 ~ Reviewed December 2004 |
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Arizona, like many areas of the
country, has experienced a dramatic increase in the number of homeowners
associations ("HOA’s"). Recently, HOA’s have been in the news and some
of the commentary has been confusing. Here are some facts. Condominium and planned community HOA’s are regulated by statute. The distinction between condominiums and planned communities involves the ownership of common areas. In a condominium community, each unit owner owns an undivided percentage ownership of the common area. In a planned community the common area is owned by the HOA. These condominium and planned community statutes govern matters such as the penalties an HOA may impose, meeting and record requirements, liens, and required disclosures on the resale of a home. Additionally, there are statutes regulating HOA lawsuits related to dwelling design, construction, condition and sale. Developments that have mandatory HOA membership but do not contain any common areas do not fall within the statutory definition of either condominiums or planned communities. In most of these developments, restrictive covenants are recorded against the property (commonly referred to as "CC&R's"), which empower the HOA to control certain aspects of property use within the development, often including oversight and approval authority over the construction of new homes and alterations of existing ones. When a person buys a home in such a development, the person receives a copy of the CC&R’s and agrees to be bound by their terms. Thus, the CC&R’s form an enforceable contract between the homeowners as a whole and the individual homeowners. Whether or not to live in a development governed by CC&R’s and an HOA is an individual choice. Therefore, all prospective homebuyers should be advised to thoroughly read any CC&R’s recorded against the home and make sure they can live with the conditions and restrictions contained therein prior to close of escrow. For more information, go to the Department of Fire, Building and Life Safety website: www.dfbls.az.gov/UserFiles/File/administration/HOA%20Package04012007.pdf K. Michelle Lind, Esq. K. Michelle Lind is General Counsel/Assistant CEO to the Arizona Association of REALTORS® (AAR). She serves as the primary legal advisor to the association. Michelle oversees AAR’s Risk Management Committee, which includes professional standards administration for twenty of the state’s local REALTOR® associations, and the development of standard real estate forms. She is the author of Arizona Real Estate: A Professional’s Guide to Law & Practice and a regular contributor to the Arizona REALTOR® and the Arizona Journal of Real Estate & Business. Please note that this article is of a general nature and may not be updated or revised for accuracy as statutory or case law changes following the date of first publication. Further, this article reflects only the opinion of the author, is not intended as definitive legal advice and you should not act upon it without seeking independent legal counsel. |
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