HOAs Hurting Residents Property Values

By
Real Estate Agent with Jeff Fritzson Real Estate, Ebby Halliday Realtors 0629874

Believe it or not some Texas HOAs are hurting their own residents' property values. It is not intentional or at least I don't think it is. In certain areas of Frisco and McKinney there are HOAs that have decided that real estate open house signs should not be used. They go around and will pull these signs if they are put up and they see them. They do not bother to contact the Realtor® regarding the infraction. They simply pull the signs without notice and destroy them. These signs are not inexpensive. They average in Texas about $25 per sign.

How does this impact a resident's property value?

If people cannot find your home, you cannot sell your home. When you limit your marketplace, you limit your ability to get the most offers. The more offers you get the more opportunity to improve the offers. The better your chances of getting larger offers. This is not limited to only that particular house for sale. When people try and find a home and can't that looks bad for the whole sub-division.

When buyers discover that it is the HOA causing the issue and not the real estate agent sending them on a wild goose chase that HOA looks bad. Now if an HOA is going to be that strict on an open house sign how strict are they going to be about all the other things HOAs control such as landscaping, paint, driveways, extensions, pergolas, patios, etc.... It is HOAs that take this type of stance that give HOAs a bad reputation. In this case the reputation has been earned.

Solution

It would be very easy for the HOA to work with Realtors®. We all want to have a nice place to live. Give the Realtors a 4 hour window on the weekends. They can hold an open house anywhere from 1 to 5 and keep their signed up from noon till 6. Any sign left up after or put up early can be removed. HOAs should realize that realtors will help their residents get the most money for their house. This in turn increases the subdivision's property values and after all isn't the primary goal of an HOA to maintain and increase the property values of their residents?

Sometimes HOAs will create issues that are not necessary and even detrimental. For more information about Frisco and Texas HOAs, you can learn more here.  When you are looking in Frisco, McKinney or anywhere in the North Texas area, come talk to me. You will find as much as you want to know about HOAs, after all I am the President of mine. Then come find out what my other clients already know, when you work with me—Your Success is My Focus.

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Home Selling
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Texas Collin County Frisco
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frisco mckinney hoa open house property values

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Rainmaker
4,431,983
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

Thanks for the post. One of the things that has brought down values in a community that I know is that owners are not allowed to rent it out. When owners have to move they are forced to sell at a low price rather than keep it vacant. It would have been better if they could rent it out .

Aug 26, 2014 09:27 PM #23
Ambassador
2,550,189
Ed Silva
RE/MAX Professionals, CT 203-206-0754 - Waterbury, CT
Central CT Real Estate Broker Serving all equally

I once had an HOA president come in to tell me I had to take down my open house signs as one of the neighbors was complaining. I thought is was foolish as how would a potential buyer know where to find the condo otherwise? He agreed and asked me to please remove the signs. I said I would do it right away as it was already the end of the open house period and proceeded to follow him out of the condo.

Aug 26, 2014 09:38 PM #24
Rainmaker
451,958
Ron Barnes
Associate Broker at Berkshire Hathaway Home Services Georgia Properties - Jasper, GA
"Most agents claim they're #1 - I THINK YOU'RE #1!

I can appreciate not wanting a deluge of signs, but I agree they shoot themselves in the foot by being so restrictive. HOA's get a reputation as being cratchety (is that a real word), and although agents form opinions, so do buyers.

Aug 26, 2014 09:40 PM #25
Rainmaker
1,505,944
Gary L. Waters Broker Associate, Bucci Realty
Bucci Realty, Inc. - Melbourne, FL
Fifteen Years Experience in Brevard County

Some folks have nothing else to do with their time but to police the neighborhood regardless of consequence.

Aug 26, 2014 10:20 PM #26
Ambassador
604,785
Brian Schulman
Coldwell Banker Residential Brokerage, Lancaster PA - Lancaster, PA
Lancaster County PA RealEstate Expert 717-951-5552

I have a condo listing with an HOA that doesn't allow sale signs at all.  There is no doubt that this is hurting sellers.  Comps are much higher for similar properties nearby without HOAs.

Aug 26, 2014 10:27 PM #27
Rainer
372,411
Keith Lawrence
RE/MAX Properties - Mahwah, NJ
ABR, CDPE, SFR, 203K Specialist

You are correct that when signs are not permitted on a property it does make it a bit more difficult to sell the property.  We have the same issue here with HOA.  To get around this we use balloons to indicate an Open House.  Also, place a sign at the entrance to the community not on HOA property is usually permitted, but coordinate this with the association first.

Aug 26, 2014 10:41 PM #28
Rainmaker
555,882
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
Home Ownership is w/in Reach. We Make it Happen!

Good Morning Jeff: Too restrictive regulations can be very problematic. And most of the time, they tend to become constrictive to live with.

 

Aug 26, 2014 10:50 PM #29
Rainmaker
2,424,079
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

yes to keeping all things equal when a group gets together or even more intimately lives together as neighbors...Hard to please all

Aug 26, 2014 11:30 PM #30
Rainer
220,096
Suzanne Otto
Six Twenty Designs - Lansdale, PA
Your Montgomery County PA home stager

I live with an HOA and they have the same rules. There's a home on my street for sale, but you only see the signs when they have an open house. Honestly, I wouldn't mind a for sale sign in their front yard or something. I don't see it as an eyesore. Not really sure what the big deal is.

Aug 26, 2014 11:53 PM #31
Rainmaker
2,974,043
Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Every so often you do get a bit of a "crazy" hoa who makes stupid rules. I say contact the home owner and have them get a committee together to change the rules.

Aug 27, 2014 12:07 AM #32
Rainmaker
1,523,566
Sybil Campbell
Long and Foster REALTORS® 5234 Monticello Ave Williamsburg, Virginia - Williamsburg, VA
REALTOR® ABR, SFR, SRES Williamsburg, Virginia

Jeff, I had this happen to me once and posted a blog about it.  I had a minivan, so I parked it in front of the house with the open house sign in the back window, they couldn't get to it since the van was locked and no one said a word to me.

Aug 27, 2014 12:13 AM #33
Rainmaker
908,388
Pamela Seley
West Coast Realty Division - Murrieta, CA
Residential Real Estate Agent serving SW RivCo CA

I've noticed homes in gated HOA communities with strict rules tend to sell less than comparable homes in close proximity without HOAs. 

Aug 27, 2014 01:36 AM #34
Rainmaker
241,322
Bette Gottwald
UNITED REAL ESTATE | Central PA - Mechanicsburg, PA
"Bet"on Central PA Real Estate!

It seems, all too often directionals and Open House signs are misplaced, sometimes obstructing the view of incoming traffic, or placed on a homeowners lawn without permission.  Unfortunately, HOAs are trying to protect the homeowners, not realizing they may be hurting potential sales.

Aug 27, 2014 01:40 AM #35
Rainer
96,912
Jeff Fritzson: Frisco Real Estate Pro
Jeff Fritzson Real Estate, Ebby Halliday Realtors - Frisco, TX
Your Success is My Focus!

There are some great comments throughout this thread. While I believe HOAs usually help communities it is amazing how many don't see the forest through the trees. I have read each and every comment and will try to reach out to all of you on your blogs.

There seems to be a consensus that HOAs and their power can be detrimental as well as helpful. What I have found most often is that the people in the communities that have HOAs are often apathetic about the HOA until it involves one of them not following the process. Then HOAs become the devil.

In this case most people would not know about this ordinance until they have to sell. By then they are just glad to get out. I don't think that is the best way to move forward. That is why I take an active participation in my HOA.

While somethings may be actionable, when weighing the amount of work and effort to fight for the signs does not make it worth the fight in my eyes.

I agree with many that a properly advertised open house will often provide potential buyers, I also know the majority of the traffic coming through comes from signs not advertising. While it may not make the biggest difference, even getting strangers who have some interest in purchasing can be lucrative for the seller and buyer. Imagine those home owners that decide they want to try it on their own.

In addition, residents are paying for their HOA. As mentioned, this will take a little bite out of the buyers wallet. To make that more palatable it would be great for HOAs to track milestones and projects that they have worked on to enhance the values of the properties. Releasing their financial statements would be a big plus too to make sure they are solvent and ready for future maintenance. Without that you are heading for special assessments on top of your HOA dues.

Regarding the magic HOA dust that help sell homes, some of the HOA board members maybe confusing that with their pipe tobacco. These are the same ones that prefer strangers knocking on condo doors trying to find the right one that is for sale.

HOAs in many areas of Texas often restrict the percentage of homes that can be leased. Those that are not can be inundated with investor properties which typically reduce the property values of the neighborhoods as renters are not generally known to take as much pride in their home as homeowners.

Thank you all for taking the time to read this and make comments. This just adds to the community and the wealth of information made available to all.

Aug 27, 2014 03:19 AM #36
Rainmaker
527,274
Peggy James
EXIT Realty Associates - Woodbridge, VA
Woodbridge Virginia Area Real Estate Specialist

Jeff, we have the same issues here in Virginia. We have a condo/townhouse complex in Woodbridge Virginia that does not allow any For Sale Signs what so ever on the property. Open house signs are allowed on the day of the Open House. Prospective home buyers driving the neighborhood have no clue if a home is for sale unless they are using a Mobile App.

Aug 27, 2014 10:52 PM #37
Ambassador
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Patricia Kennedy
RLAH Real Estate - Washington, DC
Home in the Capital

Hi, Jeff!  Just to let you know - I included this post in today's Last Week's Favorites!

Aug 31, 2014 11:57 AM #38
Rainmaker
741,694
Rob D. Shepherd
Windermere/lane county - Florence, OR
Principal Broker GRI, SRES

We have an HOA like that here. Most propeties are 25k to 100k I cannot aford it and don't list there.

Aug 31, 2014 11:09 PM #39
Rainmaker
1,026,912
Susan Haughton
Long and Foster REALTORS (703) 470-4545 - Alexandria, VA
Susan & Mindy Team...Honesty. Integrity. Results.

There are out of control HOAs all over the country, from what I have read.  I was once holding a broker's open in a neighborhood when the property manager rang the door bell and threw my signs into the foyer of the house.  To bad for him, I was a resident of the neighborhood and knew for a fact there was no prohibition against the signs.   Other resients heard about it and when contract renewal time came, the HOA went with a different association management company after having been with him forever.  Never have understood why some people have to be no difficult

Sep 01, 2014 05:50 AM #40
Rainer
103,057
Rosie Moore
Serving Sugar Land, Richmond, Rosenberg, Missouri City - Sugar Land, TX

I hear ya!  I like the proposed solution you provided. Hopefully, those type of HOA's will see the realtor's perspective.  In fact, they should focus their efforts on residents who don't maintain their yards and upkeep of their homes.  If you have 10 or so OH signs, that can be expensive if they're confiscated.  I know a fellow realtor who went to the HOA and demanded to find out where her signs went.  Well, she spend the afternoon dumpster diving and fetched all of her signs! Thank goodness!

Sep 01, 2014 12:12 PM #41
Rainmaker
303,033
Kate McQueen
CB&A Realtors - Cypress, TX
Tailored service for your real estate needs!

HOAs sometimes go too far and this is the case with the open house signs.  I'm not sure if this is the reason, but I think sometimes a little authority can go to people's head.

Sep 11, 2014 03:55 AM #42
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Rainer
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Jeff Fritzson: Frisco Real Estate Pro

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