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How do Rentals in an HOA work?

Posted by taylor on November 16th, 2016

Rental Housing in Community Associations (HOA’s, PUD’s)

 

Operating rental properties in HOA’s can be a challenge because many of the associations and their policies can be anti-landlord and anti-renter. In both 2014 and 2015, the Utah State Legislature passed legislation to prohibit many policies such association had passed that were hurting landlords and tenants.

The Utah Apartment Association pushed for these rules on community associations because owners and property managers had reported an increase in hostile policies that seemed designed to treat renters and rental owners differently and charge them more. Examples of policies we made illegal were charging extra fees to rent a unit, restricting renters from using pools or tennis courts, having a $500 fee each time a tenant moved in or out (but not having such a fee for owners), etc. If you have questions about specific policies or charges with your community associations feel free to call us to discuss.

What Community Associations can do

HOA’s and PUD’s can have policies limiting the number of units in the community that will be used as rentals. This is necessary because in some cases, if the percentage of rentals in a community becomes too high, lenders will no longer finance individual units. So state law allows community associations to set a cap. Be sure you understand that before you buy a unit in a HOA or PUD.

Community Associations can:

  • Require the names and contact info of tenants residing in the rental
  • Require an owner get a signed addendum stating the tenants will following the community rules
  • In some case, require a copy of the lease
  • Have rules that are the same for owner occupied and rental occupied units

What Community Associations can’t do

  1. They can not require landlords give them copies of credit reports or applications with personal info.
  2. They can not insist on board pre-approval of applicants. In other words, they don’t get a say in who you select.
  3. They can not charge any higher fees or assessments on tenants or landlords than they do to other residents.
  4. They may not have different rules or privileges for owners than renters.

 
If your HOA is giving you problems and you would like some help, please call the UAA any time at 801-487-5619

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