Boca West residents find they can't sell

homes due to $40,000 club fee

Article Courtesy of Sun sentinel
By Tal Abbady 
Published February 16, 2004

West Boca · It has lake views, a wrap-around deck and sunlit rooms, but Roy Kroul's condo has no takers.

Once prospective buyers learn they have to fork out nearly $40,000 to be members of the Boca West Country Club, they take their home-owning dreams elsewhere. Since residents voted in April to make club membership mandatory for any incoming buyers, Kroul and several others living in what they've dubbed the "lower end" of Boca West have watched their homes languish on the market for months.

But real estate analysts say the conversion to mandatory membership is part of a trend
among country club communities necessary for the survival of such upscale residential enclaves.
"It's the most inequitable burden on non-equity homeowners," said
Kroul, 75, who has been trying to sell his 1,200-square-feet, one-bedroom condo in the Sabal Lake subdivision for several months. "People fall in love with it when they see it. They love the view, the water, the simplicity of it. But they can't afford the equity," he said, referring to the one-time $40,000 fee now imposed on incoming buyers.
Riy Kroul of Boca West said the $40,000 cost of
joining the country club deters potential buyers
who are interested in his condo.
Not all communities impose staggering fees. Residents can buy into a country club community for less than $10,000, and some provide financial programs to help families stagger the costs of membership.

"There's more than meets the eye than mandatory membership as to why these units are not selling," said Robert Patasnick, a Fort Lauderdale partner with a national accounting firm and a specialist in country club communities. Patasnick worked as Boca West's auditor for 18 years, and was a consultant in its transition to mandatory membership. He said reports of poor sales while a community is transitioning into mandatory membership can hurt, but in the long run property values are bolstered

Kroul is one of 300 homeowners who bought their homes without club membership in Boca West. When news of the impending vote spread a year ago, they rallied in protest but were dwarfed by the roughly 2,800 club members who approved the measure.

Kroul, a retired graphics artist from New York whose walls are decked with the watercolor portraits that fill his time, bought his place more than two years ago for $83,000. He is now asking $120,000 and will have to lower his price if he gets no offers soon.

Like some of his neighbors, Kroul wants to leave Boca West for a more affordable community. He pays nearly $400 in monthly maintenance fees, which eats into his savings. Kroul lives on a $25,000 annual pension.

He is not alone. Dorothy Manuszewski, 73, has had her two-bedroom Sabal Lake home up for sale since May. She has lowered the price to $150,000 from $176,000, but still has had no offers. She bought the unit three years ago for $131,000.

"The equity is a noose around the neck," said Manuszewski, who works as a sales clerk. "It's the most unfair thing that happened with people's real estate here."

"In a regular community, Dorothy's apartment would have sold one-two-three. But few people are willing to commit to the equity and monthly charges," said Jane Zinno, Manuszewski's real estate agent.

She said Manuszewski's situation was an anomaly in a robust market that has seen property values go up by as much as 20 percent in parts of Palm Beach County.

Roberta Dyson was ready to sell her Boca West unit in 2002, but then was diagnosed with cancer and focused her energy on fighting the disease. Now healthy, the 66-year-old who lives on an $850 monthly widow's pension is bracing herself for a tough time in the real estate game.

"It's ridiculous," said Dyson, who is staying in Gainesville while she rents her unit. "I bought into that place with no equity. I should have the right to sell with no equity."

Dimming the prospects of a sale for Manuszewski, Kroul, and others, the $40,000 club fee is expected to go up to $50,000 in October because of an added charge that will finance renovations in the club's fitness center, Kroul said.For families or single, middle-class buyers looking at the Sabal Lake units, which range in price roughly from $70,000 to $180,000, it's another charge that puts the community out of their financial reach. Once they're in, families pay up to $5,000 in annual dues.

"I fell in love with the place and was ready to do everything I needed to secure it," said Wendy Markbreiter, a 40-something teacher who works in Delray Beach and considered buying Kroul's apartment. "But when I learned about all the additional fees, it was very discouraging," she said.

"It just isn't a good investment," Markbreiter said. "Once you're in you can't get out. You're stuck."

Attorney Larry Glickman, who represents the Boca West Master Association, said the fee change was meant to benefit the community's long-term financial health.

An aging population in clubs such as Boca West led to waning club memberships among residents, and that has forced many communities to go mandatory, Patasnick said.

"During the explosion of gated communities, developers would drop a country club right in the middle of a community to sell lots. That was in the '70s and '80s, when everyone was young and it was the American dream to retire and move near the beach or a country club," Patasnick said. But as they aged and felt the effects of a tightening economy, club members dropped out and communities struggled with dwindled budgets, leading to mandatory membership votes.

"The country club is no different than the gates, the street lights or the mailboxes," Patasnick said of the recent shift in attitudes toward country clubs, which were once seen by the average resident as a separate playground where a select group hobnobbed on the greens. Communities are now trying to present their clubs as part of the "common elements" that need to be maintained by everyone to protect property values.

Over the past five years, Patasnick said, local communities that have voted in mandatory membership include Boca West, Boca Woods, Bocaire, Broken Sound, Stonebridge and Woodfield. Boca Lago is considering joining the trend and a vote is expected in March.

As he takes in the breeze on his deck and watches golfers roll by in their carts, Kroul does not look like a burdened man. But not being able to sell his home could force him into financial ruin. He says he may have to walk away from his mortgage payments and foreclose. "All my savings are wrapped up in this place," he said. "It would destroy me."