I understand what HOA’s do, and was first introduced to the term in a condo building (not mine). I understand in a condo building, or high rise, you’re all sharing one building and need to contribute to that building’s maintenance. But I don’t understand HOA’s in neighborhoods…when you live in your own house. Is it only certain neighborhoods? I know someone who lives on a nice street in a suburb and there’s no HOA. Who decides if there is one, and what do neighborhood HOA’s exist for? Are you allowed to opt out?
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Typically you see them in residential neighborhoods that were built more recently, and they’re put in place by the developer. If that’s what they want to do, then part of the contractual agreement for buying a house there requires you to join the HOA, and typically that contract also stipulates that you can only sell the house to someone who also agrees to being in the HOA.
I guess a pre-existing neighborhood could all get together and decide to create an HOA and all sign contracts locking them into it, but if you already own a house in that neighborhood they couldn’t force you to join it.
Generally these kinds of HOAs exist to try to maintain property values by enforcing some level of standards of property maintenance and maybe design standards. Prevent homeowners from tying up goats in their front yard, or painting their house red with yellow polka dots, or whatever.
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