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Subject: Section 8 in our HOA
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Author Messages
DavidA7
(California)

Posts:179


10/13/2012 4:55 PM  
Hello all,

I just found out that one of our rental units is a section 8 unit. The unit was rented under a previous owner, who never informed the Board, that they qualified their unit and subsequently rented out under Section 8. Our CC&R's are quite on this subject as is Davis-Sterling. We are in CA.

My concern as a property owner is the reduced value of my property. I can see a potential buyer finding out there is section 8 housing on the property and saying no way.

As a Board Member I'm trying to find out if there is a requirement to inform and be granted permission to make a unit section 8 housing.

Any advice?

TimB4
(Virginia)

Posts:15889


10/13/2012 5:21 PM  
A rental is a rental.

The Association must treat all rentals equally. To do otherwise could cause major issues (like a discrimination lawsuit).
GlenL
(Ohio)

Posts:5491


10/13/2012 5:28 PM  
Your remedy as with any other renter lies with the owner. While Section 8 does have negative connotations any renters still have to apply with the HOA CC&R's.

Studies show that 5 out of 4 people have problems with fractions
LarryB13
(Arizona)

Posts:4099


10/13/2012 6:01 PM  
Posted By DavidA7 on 10/13/2012 4:55 PM

I just found out that one of our rental units is a section 8 unit.

* * *

My concern as a property owner is the reduced value of my property. I can see a potential buyer finding out there is section 8 housing on the property and saying no way.



David,

You imply that there are other rental units. Is this a condo?

If there are other rentals in addition to the Section 8 unit, why the sudden concern about property values? What will the Section 8 unit and its tenants do to devalue your property that the other rental units and their tenants have not already done?

DavidA7
(California)

Posts:179


10/14/2012 10:50 AM  
Ok - let me make clear my concern is not the renters they are actually very nice people. My concern is about the Section 8 status on a Unit. Yes we have other rentals in our Townhome Complex but from what I have heard and some basic reading that having Section 8 status on a unit in your complex reduces your property value and attractiveness to potential buyers. I even remember looking at a property 6 years ago and a RE agent saying when I asked about a complex don't go there they have Section 8 housing which hurts property values.

From an individual perspective I'm concerned about what this means to my property value, if anything? Its hard enough dealing with what has happened in the past 5 years to my property value and then potentially another hit.

As an HOA Board Member I'm trying to determine if a Homeowner was legally allowed to convert their property into section 8 housing without HOA notification/approval etc...

Thanks
MelissaP1
(Alabama)

Posts:7535


10/14/2012 11:31 AM  
I don't see where it's any of the HOA's business to know this information. A HOA stands for Home OWNER's Association. That means that homeowners share in responsibilities of managing and funding common property to keep the area nice to ATTRACT potential buyers. A HOA does NOT keep home values up. They keep the appearances up to keep buyers interested in purchasing. Property values are based on what similar houses in a few mile radius have sold with similar rooms and features. (3 bedroom 2 Bath homes as example).

What really effects your home values is foreclosure sales. You and your HOA members may have houses selling at $500K but if one of those sell at $300K in a short sale/foreclosure it's going to be used as a "Comp" in your area. Nothing much you can do about it but wait about 6 months after a foreclosure sells and hope more homes sell at the $500K price range in that time frame.

Rental effect on a HOA is with the ability to offer certain loan programs. FHA, Fannie Mae, or Freddie Mac may not like offering loans to those HOA's with high amount of rentals. They may offer higher interest rates to those who buy into a high rental HOA or nothing at all. That just means that potential buyers have to have stronger credit and loan options. It's NOT a lower home value. It's less potential buyers who qualify for loans situation.

Hope that clears things up a bit. Section 8 doesn't mean much except to the person who is renting the place out. The HOA just needs to recognize that the property is rental and hold the owner's feet to the ground on any violation. The owner is responsible for paying ALL dues NOT the renter.

Former HOA President
TimB4
(Virginia)

Posts:15889


10/14/2012 4:50 PM  
David,

If your governing documents do not require notification then there is no other requirement that notification be made (at least that I'm aware of).

I suspect that if your documents did require notification, that such notification would be a violation of some law.

Per HUD's fact sheet "The participant is free to choose any housing that meets the requirements of the program and is not limited to units located in subsidized housing projects."

Based on the criteria a property has to have in order to be part of the program I would suspect that any home that is properly maintained and built after the lead paint ban would qualify.

I suspect that the economy has more of an issue to play in why section 8 housing is in your development than anything else. This is because it's likely more people are qualifying for the assistance and landlords are able to rent with the government picking up part of the tab.
BrianB
(California)

Posts:2820


10/14/2012 9:31 PM  
1) Really? Look at this economy, and tell me... do you really think a section 8 rental is what is lowering your property value?
2) Can you quantify the value of your property prior to this rental, and now, after? How much has it been lowered?
3) Do you honestly believe that your property value would rise if you eliminate the "nice people" in the section 8 home, and replaced them with, for example, a non-section 8 pedophile? Or, perhaps a nice alcoholic couple who fight and scream at all hours of the night? would that make your property value rise, since it's no longer given out to n economically disadvantage person?

SteveM9
(Massachusetts)

Posts:3038


10/15/2012 9:23 AM  
As the economy goes down, there will be more and more section 8 rentals as the government takes care of the poor. There are 46 million americans on food stamps. Its quite possible 1 out of every 7 of your neighbors is on food stamps. Banning rentals in your neighborhood will only lead to foreclosures, which will lead to meth houses, vandalism, boarded up windows of vacant houses, which will also lead to lower house prices.

Your problem is not section 8 rentals, the problem is the economy sucks.
DavidA7
(California)

Posts:179


10/15/2012 12:31 PM  
Everyone thanks for your reply in helping me understand this.
KellyM3
(North Carolina)

Posts:1295


10/16/2012 10:25 AM  
Setting aside all the political correction, just enforce your HOA covenants and all should be fine.

Will potential home buyers be given an impression if they learn of Section 8 status within your community? I would expect so. Section 8 housing is viewed by many as slum housing, which is not necessarily true, though many property owners qualify dumpy properties w/ the program to up their rent collection rates - which is guaranteed by the Feds. You're feeling what many people would feel.

Set community expectations and hold to them. Tenants are tenants and if they're good, they'll be as quality a neighbor as any owner.
AmyM9
(Florida)

Posts:1


02/14/2018 2:09 PM  
The problem is that the economy took a dive and investors came in and purchased homes in neighborhoods in suburban areas with income levels in the range of $45,000-$65,000. Basically middle to upper middle class families who work very hard so they can live in a nice area and raise their families. The investors don't live in these neighborhoods and could not care less whether the people they rent to are good law abiding citizens or not. Whether you like it or not, whether it infuriates you or not, the residents in these neighborhoods purchased their homes there to be around others in the same income bracket as to help ensure a certain quality of life. When you bring in renters on section 8, you're bringing in people that wouldn't be able to afford to live in these areas without government assistance and a great deal of them have never lived any other way. Since the economy went south and homes were purchased by investors in my neighborhood, in the past 8-10 years I've lived next door to felons who brought their drug business with them along with law enforcement who was always looking for them, their kids hung out skulking around smoking pot on the corners, breaking into homes and cars, stealing bicycles which they piled in a heap behind their rear fence, the yard was let go, I constantly have garbage in my yard and my son can no longer ride his bike around the neighborhood and play with his friends. This was the first set of renters. No one that has lived there have been law abiding, hard working people. No matter what they say on forums such as this one, the people who work hard to maintain a certain quality of life don't want to have to worry about living next to or near this caliber of person and that's exactly why they bought a home where they did. I wish I had known about a rental policy in the Bylaws of my HOA before I purchased my home. Despite what you may think, people do bring their environment with them and once they're in, they can be hard to get out. Unless you're dealing with some very exceptional people who want to change and are willing to maintain the same quality of life standards as the rest of the neighborhood, this is what you end up with. I work very hard to be able to afford to live in the area I live in, if I wanted to live in a low income, high crime area, I would have purchased my home in one.
SheliaH
(Indiana)

Posts:2231


02/14/2018 3:02 PM  
This conversation is 5 years old - you may want to start a new conversation if you want to discuss current issues.

GenoS
(Florida)

Posts:2291


02/14/2018 10:40 PM  
And break up long paragraphs into shorter ones, please. Very difficult to read long ones.
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