PROPERTY OWNER'S ASSOCIATIONS AND CONDOMINIUM ASSOCIATIONS
Property owner's associations and condominium associations oversee the community, maintain the common areas of the community, and enforce the rules and regulations of the association. Property owner's associations and condominium associations collect fees from all members in order to carry out the duties and responsibilities of the association.
Participation in a condominium association is mandatory. Participation in a property owner's association may be voluntary or mandatory and whether it is mandatory is set forth in the covenants and restrictions of the association.
Depending on who you speak with, you will hear some very good things and some very bad things about property owner's and condominium associations. If an association is strong, it serves to protect home values by ensuring that properties are maintained and that rules and regulations regarding things like exterior paint colors, fencing, yard maintenance, pets, parking cars, etc. are enforced.
In regard to property owner's associations, mandatory associations are usually much stronger than voluntary associations. The reason for this is that in many communities with voluntary associations, it is quite difficult to get all of the homeowners to participate. If there is a lack of participation by the homeowners, it makes it much harder to enforce the rules of the association.
One of the biggest problems with condominium associations, especially in economically challenged areas or in communities that do not restrict an owner's ability to rent his condominium unit is a failure of the association to pay the water bill. There have been horror stories in the news about residents losing water service because the association failed to pay the water bills. In the most egregious cases, the association may have delinquent water bills totaling hundred of thousands of dollars.
In Virginia, if you purchase a property that has an association, you are entitled to receive the most current covenants and restrictions or declarations of the association. The seller is required to provide you with the declaration and any updates. If you are unable to get the covenants and restrictions or declarations from the seller, you may, at your expense, obtain a copy from the association. In the case of a property owner's association, Virginia law requires the seller to provide the buyer with a disclosure packet that contains very specific information in addition to the covenants and restrictions. In the case of a condominium association, in addition to the declarations, Virginia law requires the seller to provide the buyer with a resale certificate that contains very specific information.
Associations have a lien for all unpaid association dues. Failure of a homeowner to pay condominium or association dues can result in the non-judicial foreclosure of the association's lien after the provision of notice to the homeowner and the trust deed holders.
A title search should reveal any association liens. However, it is a best practice to make sure the closing attorney has requested a closing statement from the association and that any unpaid association dues are shown on the settlement statement at closing.