| TOWN HOMES -- AN OWNERS' NIGHTMARE? |
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An Opinion By Jan Bergemann Published October 24, 2007
We hear continually about the fights in town home communities. But it gets even worse if it's a master association where condos, villas and town homes are combined in one big community. The easy explanation? The interests of owners in a condominium and owners of a villa can be very opposite!
In a condo you know that you are just buying air -- surrounded by walls officially owned by the association -- minimum until the moment these walls and other common interest properties have to be repaired or maintained.
In a villa or town home you buy actually deeded property, with a lot (parcel) under your home. It all looks like the buyer is really the owner -- but far from the truth. In reality, the deeded owner is allowed to pay the mortgage and association dues, but that's about where the owner's rights end!
And this leads to misunderstandings where emotions fly high -- especially in communities where boards and eager managers change the rules. See article: "Association incorporation leads to confusion". And it's actually not a matter of house or condo -- it's a matter what kind of decision-making is left for the individual owner. Many opinions quoted in this article actually miss the point: As an owner, you want to keep the right to make certain decisions yourself -- especially serious financial considerations. Isn't it YOUR money and the welfare of YOUR family? Many of the older communities had a system where owners each had their own insurance policies and each owner made other decisions regarding their property. But, many communities -- with or without the agreements of the owners -- change the system and the owners are left with merely being told what is happening to their property! Here are some of the complaints we are hearing on a continual basis: INSURANCE Since
the association handles the complete insurance package, owners are forced
to insure their personal possessions, often with a policy premium nearly
as expensive as a complete homeowner’s insurance package. Often smaller
damages to the buildings are not covered, because of the high deductible
for the complete community. Especially after the hurricanes, associations
had to levy special assessments to pay for the deductible that wasn't
covered! And never forget: The owner is not the policyholder -- the
association is. That leaves the homeowner out of the loop when it comes to
settlement talks and the
reimbursement check goes to the association. And we have seen many
owners fighting to get their homes repaired, despite the fact that the
insurance company already wrote a check to the association.
Don't forget -- big insurance policies pay very good commissions! Could that be a reason why we see so many managers "interested" in these complete insurance packages?
ROOF MAINTENANCE AND REPAIR In many of the town home communities we see managers and eager board members running around with note-pads, making notes to send homeowners violation letters asking them to have their roofs pressure-washed. In many communities it happens all too often that these letters are mailed out with the threat of fines demanding an immediate pressure-washing job. Funny enough, in many of these cases managers and eager board member just happen to know a good guy who would be available to do the job! Ever heard the word "kickbacks?" The even more dangerous part of this scheme: Pressure-washing the roof can nullify the roof-tile manufacturer's warranty! But the folks demanding the roof to be pressure-washed usually ignore this fact! LAWN AND IRRIGATION SYSTEM Many of these communities have sprinkler systems, operated and maintained by the association. If the system fails for any reasons, the homeowner can do nothing more than complain to management, asking for repair. If repair is not immediately forthcoming, the lawn may be seriously damaged or destroyed, resulting in a violation letter from the association. And guess who pays for the new lawn, if needed? Think that's far-fetched and makes little sense? You wouldn't believe how often this problem occurs! Let's face it -- the more decisions are made by non-owners, the bigger the possibility to make some money on the side! And that happens more often than the service providers want to admit! As long as we fail to see enacted much-needed legislative reforms, you better watch your money -- and sanity! If you want to pursue the AMERICAN DREAM and own a home, please think twice before buying into a community with villas or town homes. You may own a paper deed for your home, but you are facing an association board and a management company that make all decisions for you -- leaving YOU to pay the bills! It can easily be your wallet's downfall -- and the end of your AMERICAN DREAM!
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