Viviana Garcia and Jackeline Oquendo stood outside a row of two-story, comfortable-looking houses they have lived in for more than a decade in Longmont. The neighbors bought the homes, built by Habitat for Humanity, within a few months of each other.
Jason Pardikes and Mary Moore sat at a table on a backyard patio at a home in Todd Creek Farms, an upscale subdivision of 370 homes nestled among rolling hills near Brighton and stretching over 780 acres.
The settings are different, but the four, like many Coloradans, live in homes governed by homeowner associations. And they believe their communities would be better with changes in how HOAs work.
At least 40% of Coloradans live in an HOA and homeowners are reporting trouble keeping up with soaring home insurance rates, which are driving up monthly dues. Those who can’t keep up with the increases face foreclosure or looking for a new home in one of the country’s priciest housing markets. With the stakes increasingly higher, residents and lawmakers are pushing for more accountability from the pseudo-governmental HOA boards, made up of homeowners who volunteer for the job, and the companies hired to handle the daily management duties.
“I’m a retired teacher and I’m trying to supplement my income with substitute teaching,” said Cynthia Masters, whose monthly HOA dues at her Lakewood townhome is nearing $700. “This is just insane if your house payment is $1,200 and you’re adding $700 more on that.”
Masters said the board attributed the increases in dues to more expensive insurance. Older multifamily buildings have been hit particularly hard as some insurers have exited the market or significantly hiked their rates.
What is a homeowner association?
Homeowner associations can seem like a mystery, like a social group where sparsely attended meetings start with a secret handshake. According to NerdWallet, HOAs “govern a neighborhood or multi-unit building, primarily by making and enforcing rules to follow if you live there. HOAs are run by boards of directors, made up of — and elected by — neighborhood residents.”
While the owners of single-family homes or condos in an HOA typically have their own insurance, the association’s insurance policy covers common areas, such as roofs, pools and other structures or shared assets managed by the HOA. The policy also also provides general liability coverage if someone is injured on common property, according to insurance.com.
Garcia and Oquendo and other residents in the eight units on the west side of the Cornerstone Condominiums HOA in Longmont said they’re dealing with another common complaint of HOA members: lack of communication. They said the association and the management company won’t respond to questions about the termination of a landscaping service they believe they’re still paying for. They said they can’t get answers about rising monthly dues and the association’s finances.
Now, the residents face a vote that would cut their units out of the HOA that includes four homes on the east side of the street.
At Todd Creek Farms, attempts to update the HOA’s covenants and polices have spawned three lawsuits and death threats. Pardikes, the HOA board president, supports reforms and believes legislators can do more to ensure that homeowners aren’t at the mercy of rogue boards or management companies.
“The ability for an HOA to actually change its covenants to meet its needs is really, really difficult,” said Pardikes, who wants to see the threshold for changing association policy lowered, perhaps to a vote of 50%-plus one of the households.
And he’d like to see oversight of companies that manage HOAs. A bill by Rep. Brianna Titone, D-Arvada, that would have revived licensing requirements for the companies failed in the last legislative session.
Titone and Rep. Naquetta Ricks, an Aurora Democrat, are looking at reintroducing their HOA bills that didn’t make it out of the 2024 Colorado General Assembly. Ricks’ bill would have set a minimum sales bid when an HOA forecloses on a home to ensure that the owner walks away with some equity.
An investor can snap up a property after paying attorney’s fees and the money owed to the HOA, leaving the former owner with the mortgage and no return on the investment. Ricks’ bill would have factored in the home’s fair market value when setting a bid.
Homeowner associations are second only to property tax entities when it comes to collecting debt in a foreclosure on an HOA property.
“The bill’s coming back. We cannot sanction equity theft in Colorado,” Ricks said. “I don’t want people entering into homelessness because they’ve owned a home and the home gets sold for a little bit of nothing.”
The 2024 legislative session was chock-full…
Read More: HOA fees, home insurance hikes have Coloradans seeking reforms