When home associations go bad
If the home you’re considering buying is part of a homeowners association, the state wants you to know more about the rules you’ll be expected to follow.
South Carolina lawmakers passed legislation in May that requires HOAs to file all governing documents, amendments, rules and regulations in one central place with the county land records department, which makes them publicly accessible. The law went into effect on Jan. 1.
That means homebuyers can know in advance if the HOA they might be a part of limits lawn decorations, garage additions or paint colors.
“Most HOAs in our area have always been cooperative and have (their governing documents) on their websites,” according to Cindy Creamer, a realtor on Hilton Head. But she said “there was no requirement that a potential buyer have access to the governing documents” before the new law went into effect.
Peter Kristian, the general manager of the Hilton Head Plantation Property Owners Association, said the new law affects more than just governing documents. HOAs must also update their rules and regulations each year with the county. That can include anything from changing the times of swimming pool access to applying for a new stop sign, Kristian said.
All of those things are now a part of the public record, which he said gives them power.
“No HOA will have the ability to enforce the terms found within such documents unless the documents are recorded by January 10,” according to John Carroll, a real estate lawyer on Hilton Head.
The law also requires that homeowners associations not incorporated as nonprofits to give members 48-hour notice before the group increases the budget.
However, “since many well-established HOAs are organized as nonprofit corporations pursuant to the South Carolina Nonprofit Corporation Act, many HOAs will not be impacted by this new rule,” according to Carroll.
The purpose of the legislation is to provide more transparency for buyers, who can access HOA records and now must be notified if the home they intend to buy is part of an HOA, according to the law.
“All new listings and renewed listings will require the new disclosure document,” Creamer said. “This will also provide potential buyers one location they can be directed to review the bylaws, guidelines and covenants.”