WRAL Investigates

HOAs ignite clash over property rights, property values

Posted November 1, 2010 6:00 p.m. EDT
Updated November 1, 2010 7:03 p.m. EDT

WRAL Investigates

— Homeowner associations are a relatively new form of neighborhood management – 73 percent were established in the past 20 years nationwide – but they are becoming a bigger hot-button issue across the state.

HOAs can ignite the ultimate clash over personal property rights versus property values, but understanding rights and responsibilities can be confusing.

The Planned Community Act gives North Carolina HOAs the power to enforce bylaws, such as grass height, house color and how long trash cans can sit outside. North Carolina General Statute Chapter 47F also gives associations the right to collect assessments, issue limited fines and even foreclose if homeowners don't comply with those bylaws.

Jim Laumann founded HOA-NC, a Morrisville business that supports associations with education. He says the best HOAs find a reasonable balance between enforcement and understanding.

“Most homeowners do not read the covenants,” Laumann said. “Some (HOAs) go to the extremes to be the condo commanders. Some go to the other extreme of not wanting to offend their neighbor.”

Jacqueline Jones lost her job last year and faces foreclosure for a second time in Raleigh's Enclave at Forestville Farms. She was late in paying her $300 annual assessment in 2009, but after she caught up and paid a penalty, she was able to keep her house. This year, she was five months late again, and her HOA tacked on more than $800 in fines and attorney's fees.

“This is the lien they placed on my home,” she said. “I am so frustrated right now. I can't get anyone to listen to me."

Collections attorney Ed Flowers says Jones should have communicated sooner with her HOA.

“I am not unsympathetic. I've extended my payment plans, but I can't work for free,” Flowers said.

HOA battles sprinkle the area, from Raleigh to Preston Grande in Cary.

Kelly Godfrey says the HOA there constantly harasses her daughters and their town home guests, whether it's over an open garage door or parking restrictions.

“I think they are overbearing. I think they are nit-picky,” she said.

The Godfreys say HOA board members often place warning notices on visitor cars parked in visitor spaces.

“But, for some reason that's a problem here,” Godfrey said.

In one case, a guest's car was towed from visitor parking, she said.

The HOA president said parking is so limited that restrictions must be enforced out of fairness for everyone. While WRAL Investigates couldn’t find that the covenants specifically limit visitor parking, the president said the same guests kept taking up spaces.

“What we're looking for in a neighborhood like this would be if there are covenant violations,” said HOA manager John Lawton.

Lawton patrols Lakeridge in Cary and is president of HRW Inc. His company enforces covenants and manages neighborhoods, and he believes ruling with an iron fist doesn't work.

“We really try to develop a standard that doesn't make it so you're out there every time the grass is three quarters of an inch longer than it should be (or) that you're fussing with somebody,” he said.

HOAs are designed to protect property value for the many, but that doesn't mean everyone's pleased.

“There needs to be some kind of regulation for homeowners associations,” Godfrey said.

There is no regulation of HOAs in North Carolina. Homeowners can sue, but there's no regulatory body overseeing their actions. Elected volunteer board members set the tone for enforcement.

As for Jones, she should be able to keep her house after setting up a payment plan to cover her late fees.