OVERVIEW
When you purchase a home in a community governed by an HOA, you automatically agree to abide by the HOA’s covenants, conditions, and restrictions (the “CC&Rs”). The CC&Rs are a set of rules and regulations that outline the rights and responsibilities of homeowners and the HOA, and they typically cover everything from architectural guidelines and property maintenance, to common area use and parking limitations.
Despite the critical importance of the CC&Rs, the vast majority of homeowners have never read their CC&Rs, and many have never even looked at them. In some ways, this is understandable. For example, CC&Rs are written by attorneys, and unfortunately, many attorneys simply don’t write clearly, preferring, for example, to use legal jargon (i.e., “legalese”) instead of taking the time to write clearly and concisely. CC&Rs are, therefore, typically difficult to read.
This can lead to misunderstandings, disputes, and even legal battles with the HOA. As a law firm that has vast expertise in representing California homeowners in disputes with their HOAs, we have seen firsthand the consequences of homeowners who are unfamiliar with their rights and obligations as set forth in their CC&Rs.
TOP 10 REASONS CALIFORNIA HOMEOWNERS SHOULD READ THEIR CC&RS
The CC&Rs Tell You What You CAN and CAN’T Do
Your CC&Rs outline what you and your neighbors, as homeowners, can and cannot do with your properties. This can include, for example, restrictions on paint colors, types of landscaping, and the ability to make modifications to your property.
The CC&Rs Spell Out Your Legal Obligations and Rights
CC&Rs are legally binding. In fact, courts treat CC&Rs like written contracts in determining whether a homeowner or an HOA has done something wrong. Not knowing the “rules” can lead to unintentional violations on your part that may result in fines, penalties, or even legal action against you. By familiarizing yourself with the CC&Rs, you can ensure that you remain in compliance with the rules and avoid any potential conflicts with the HOA.
In addition to helping you avoid unintentional violations, understanding your CC&Rs can also empower you to assert your rights as a homeowner. The CC&Rs outline the rights and responsibilities of both homeowners and the HOA, and knowing what those are can help you hold the HOA accountable if it fails to uphold its obligations. For example, if the HOA is responsible for maintaining common areas and fails to do so, you can use the CC&Rs as a legal basis to compel the HOA to take action.
The CC&Rs Describe Your Financial Rights and Obligations
Homeowners need to be aware of their financial obligations, such as their obligation to pay their regular dues and special assessments. Those obligations are detailed in the CC&Rs. The HOA, in turn, is obligated to use the money it collects to fund things like common area maintenance and other essential community services.
In the case of special assessments, including emergency special assessments, it’s even more important for you to understand your rights so that you can help ensure that your HOA is abiding by its fiduciary duty to you and your fellow HOA members.
The CC&Rs Spell Out Maintenance Responsibilities and Design Standards for the Association
CC&Rs lay out the HOAs’ and members’ mutual maintenance responsibilities, as well as guidelines on maintaining the overall aesthetic of the community. For example, an HOA’s CC&Rs might cover some or all of the following types of things:
- the height of a member’s fence/gate;
- the types of plants that a member is allowed to plant in their yard;
- the paint color of a member’s home;
- the right to a view; and
- additions/improvements to a member’s home.
Likewise, the CC&Rs will also lay out the HOA’s maintenance responsibilities, including, for example, those related to the association’s common areas. Depending on the nature of your HOA (e.g., condominium v. single-family home), that list can be quite extensive, and may include maintenance obligations relating to some or all of the following:
- plumbing;
- roofs;
- streets/sidewalks;
- pools/clubhouses;
- green areas/parks;
- swimming pools, tennis courts, and pickleball courts;
- trees/bushes; and
- balconies/decks.
By maintaining a solid understanding of your obligations, as well as the your rights, you can ensure that you not only avoid fines and penalties, but also that your HOA abides by its obligations to keep the common area elements in proper repair.
Your CC&Rs Often Mirror the Davis-Stirling Act in Addressing Dispute Resolution
The CC&Rs for many of California’s HOAs mirror the Davis-Stirling Act’s requirements regarding dispute resolution and lay out a process for resolving disputes between homeowners and the HOA. As you can imagine, disputes between homeowners and HOAs are not uncommon, often arising for a variety of reasons, such as architectural disputes, assessment fees, property maintenance, and nuisances.
Disputes between homeowners are also quite common, taking on many forms, including things like:
- construction of spite fences;
- damage to your property caused by a neighbor’s branches or roots;
- blocking a protected view corridor;
- trespass and encroachment onto your property;
- excessive noise;
- noxious odors; and
- animal-related issues.
If you understand your rights regarding dispute resolution, you’ll be in an excellent position to start the process as soon as a problem arises. Quick action can often help address an issue before it escalates.
The CC&Rs Set Out the Rules Regarding Members’ Use of the Common Areas
Knowing the rules regarding your HOA’s community spaces, like pools, gyms, sports courts, parks, and clubhouses, is essential for enjoyment and scheduling purposes.
Some HOAs have a lot of amenities to offer their members, such as swimming pools, tennis courts/pickleball courts, gyms, green belts/parks, hiking paths, and clubhouses. For obvious reasons, the HOA has to impose a set of rules regarding their use to ensure that everyone has the opportunity to enjoy the association’s amenities without imposing on the rights of other members. For example, many HOAs have strict limitations on the hours of operation for swimming pools and tennis/pickleball courts because of the amount of noise that those activities generate for the homeowners who live close to those amenities.
If you’re familiar with your HOA’s rules regarding the use of your association’s amenities, you’ll be able to avoid inadvertent violations, while at the same time, ensuring that your neighbors’ rights are protected.
Your CC&Rs Will Spell Out Any Leasing/Renting Policies
Just as services like Airbnb became increasingly popular over the last decade or so, so to did the numbers of families who purchased properties exclusively for investment purposes. Many of those individuals seek out long-term renters, while a growing sub-set of such real estate investors are interested in what has come to be known as short-term rentals. Such short-term rentals are popular, for example, in areas near tourist destinations, such as Disneyland, ski resorts, or beach communities.
In response to the growth in the short-term rental market, many HOAs responded by attempting to ban such rentals in California. And while amendments to the Davis-Stirling Act came along to impose some regulations on what HOAs could and couldn’t do in terms of restricting rentals, the bottom line is that HOAs can ban short-term rentals if they desire to do so—but only for homeowners who purchased into an association after the ban on such rentals went into affect.
If you’re a part-time real estate investor looking into purchasing an investment property that is governed by an HOA, reading the CC&Rs before you make the purchase could save you a fortune. And if you already live in an HOA, before entering into a contract that you might not be able to cancel, it might behoove you to understand what, if any, restrictions your HOA imposes on rentals.
Your CC&Rs Will Lay Out Any Insurance Requirements That You Are Required to Abide By
CC&Rs can define the types and amounts of insurance that a homeowner must maintain, which is crucial to ensure adequate coverage in case of damage or liability.
Your CC&Rs Can Help Protect Your Property’s Value
CC&Rs often contain provisions that are aimed at maintaining the overall look and feel of the community, which can help protect—and potentially increase—the value of the properties located in the association. By understanding and adhering to those provisions, homeowners contribute to the upkeep and consistent quality of the neighborhood, which is attractive to current and prospective residents.
CC&Rs Typically Describe the Amendment Process
CC&Rs often include provisions for their own amendment, which homeowners need to understand in order to participate in the evolution of their community’s rules and to be aware of potential changes that may affect their rights or responsibilities.
To be sure, your HOA’s CC&Rs are not set in stone and can be amended by the homeowners to address changing circumstances or to clarify ambiguous provisions. As a homeowner, you have the right to be informed of any proposed amendments and to vote on them. By staying informed and participating in the amendment process, you can help ensure that the CC&Rs continue to protect your rights and interests.
CONCLUDING THOUGHT
An HOA’s CC&Rs is a critical document that outlines the rights and responsibilities the HOA and its members owe to each other. As a homeowner, it is important to read and understand the CC&Rs to avoid unintentional violations, assert your rights, and protect your interests in the event of a dispute.