Associations 101

This weekend, after wheeling my snow-clogged blower back into my garage and engaging in a brief tussle with my wife over who would wield the lighter snow shovel, I began thinking about ways to avoid ever having to clear my own driveway again. If this sounds familiar to you, it may be worth taking some time to learn about housing options that let you enjoy home ownership minus some of the burdens of home maintenance. They’re officially called common interest communities (CICs), and they include different types of homes from condominiums to attached townhomes to associations of free-standing homes. Though each of these communities has a unique character and features, there are some common elements to think about if you’re considering a move, or if you’re just curious about how the other, non-shoveling half lives.

The most significant difference between traditional single-family homes and common interest communities is the fact that homeowners in CICs trade a little autonomy for the convenience of shared responsibility. Each community is regulated by specific governing documents and administered by a homeowners’ association. All homeowners have a voice in governance and are required to pay fees to cover maintenance, taxes, and insurance on common aspects of the community. Associations are setup in a variety of ways, but in Minnesota, most are subject to the Minnesota Common Interest Ownership Act (MCIOA).

Beyond the provisions of the MCIOA and the requirement that the association be governed by a board of directors (according to findlaw.com, some 1.25 million Americans serve on these boards), communities have a great deal of leeway in how they govern themselves. Though associations uniformly collect fees from homeowners and impose certain restrictions on homeowners, there is significant variation in how those fees are used and what activities are restricted. If you are considering buying a home in a common interest community, you need to make sure you are familiar with the specific provisions governing that community. The seller is required to provide relevant documents, and you have a 10-day period to review them. Two questions it’s always worth asking about any CIC are “What do association fees cover?” and “What restrictions are there on homeowners?” 

Association fees generally cover property and liability insurance for common areas (such as sidewalks, roofs, lounges, and pools) and the maintenance of those areas. In addition, associations often, but not always, pay for ongoing services like trash, water, and sewer services. They may also pay for seasonal maintenance (like snow removal!) planned improvements or other activities that benefit the community as a whole. In some cases, an association will undertake a project that benefits only some properties, and generally the fees will be assessed only against those properties. 

There’s more variation in the types of restrictions that CIC’s place on homeowners. In some cases, CIC regulations can affect the sale of properties in the community by restricting the types of financing allowed. They can also limit what residents can do with or in their homes. Some of the most common restrictions have to do with noise, pets, landscaping activities (including what you can put on your lawn), and modifications to the exterior of the property. Usually these restrictions are aimed at limiting activities that affect other homeowners, but they can vary wildly, and the internet informs me that they are sometimes flat-out ridiculous. A California association, for example, allowed homeowners to landscape their own yards but placed a limit on the number of rose bushes allowed. In New York, one CIC building apparently bans wearing high heels indoors. Other favorite examples include requiring pumpkins to be off the porch by November 1, specifying the font to be used on mailboxes, and requiring residents to wear khaki pants and a polo shirt when having a garage sale. These, of course, are highly unusual, but it’s always a good idea to see what you’re getting into before you buy a home in a CIC.

There’s a lot more to know about common interest communities, and I’d be happy to talk with you about them any time. Right now, though, I need to go get myself another lightweight snow shovel.  

Photo credit: SouthernMinn.com, ApartmentHomeLiving.com