There is a huge difference between the way businesses and governments operate. Businesses typically keep their eye on the bottom line and minimize unnecessary expenses. If there is a cost effective way of doing something, they’ll find it and use it. Governments, on the other hand, only seem to care about the size of their departments. The more staff they have, the greater their budgets and the higher their salaries. To help get to that point they rely on regulations, red tape and more staff to oversee useless rules. And the money to pay for all this waste? No worries, just raise taxes. I knew all that so when I first encountered HOAs and was told that certain services were provided “privately” the only thing I found alarming was that the taxes were 3 times as high as they had been where I had come from where everything was included, in fact the HOA assessments were higher than my property taxes had been.
My long held beliefs about the efficiency and cost effectiveness of businesses began to unravel as I watched a “privatized government” at work. These creations of the special interests enjoyed all the benefits of the unaccountable governments while masquerading as efficient businesses. This new model was forced on owners in residential associations, be they condos, co-ops, HOAs or any of the newer concoctions that seem to creep into our daily vocabulary. It embodies all the worst characteristics of both businesses and governments.
Chuck Welsh joins us On The Commons. Chuck, an avid boater, a US Naval Officer for a number of years and a former developer bought a brand new pre-construction condo in a gated development in Florida. The design for the property came complete with plans for a marina. The entire project sounded like it was designed with Chuck in mind. A beautiful unit, amazing views, room for his boat and the promise of a carefree lifestyle with property values soaring through the roof. Isn’t that what we are all promised? Regular listeners and readers of this blog know that when it comes to housing in the US, things are never quite as smooth or problem free as one might expect. Sadly that was the case with Chuck’s ideal condo. All the elements of his dream home were there – in a dream – the problem was that the nightmares started when Chuck woke up. We’ll talk to Chuck about what happened that led to 10 years of his life that was far from “carefree” and his condo – well, even with an upswing in property values, ended up costing him a lot of money, not to mention being dragged through the courts for four years. And that private marina that was the icing on his cake? Well, that didn’t work out so well either. Tune in for all the details as well as a fascinating discussion on the future of privatized residential governments.
I seem to zip through life at breakneck speeds, taking most things for granted and never really thinking about the reason we do things any particular way. Oh, once in a while I ask myself, “What were they ever thinking?” when I run into something a little strange. However, when things are working well the farthest thought is to wonder why it works. It is so much easier to start looking at things that don’t make sense and figure out how to improve it.
And for a show whose sole focus is property rights, that was a little short sighted. How can we protect ownership and rights without knowing how to properly define the property in question? That is one those things most of us have always taken for granted.
Kenneth Ditkowsky joins us On The Commons. Ken is an attorney in Chicago who, when he was fresh out of law school, full of self confidence and a can-do attitude found himself on the ground floor of redefining property boundaries and ultimately changing skylines in cities across the country. Maybe even the world? We’ll talk to Ken about the Prudential Building, the first high rise in Chicago and the hundreds of pages of legal speak explaining the ownership structure. Ken and his partner accepted the challenge and simplified it, reducing the document down to a more manageable size. In the process they paved the way for high-rise residential buildings to be built and ultimately changing the face of the Chicago. We’ll talk about all the things most of us take for granted and never give a second thought to. We’ll learn about different ways to determine the legal boundaries of a piece of property and find out what happens when mother nature decides to ” shift” the things we take for granted. I was spellbound as I listened to Ken. Tune in for a fascinating show.
Not too long ago a friend sent me a link for a video and recommended I watch it. I did. I was shocked and horrified when I realized I was looking at a homeowners’ association. As far as I could see, there was no rhyme or reason to have an HOA in this bucolic part of the country. I have since learned that the property owners in this otherwise peaceful setting each own hundreds of acres of land accessible by dirt roads.
We’ve allowed ourselves to be fooled into believing municipal governments just don’t have the money to provide the services real estate tax dollars are supposed to pay for, therefore HOAs are a necessity to provide those services. Not that I believe that for a moment but if I did, try as I might, I could not find any reason to justify the imposition of an HOA on this particular neighborhood. Check out the video and please let me know if an HOA makes sense to you. I am convinced we have lost all sense of reality and sanity in this country.
Mary Ann Fordyce joins us On The Commons. Mary Ann has a chicken business in a rural community in Texas, where many of her neighbors are also business people, several have livestock and there is at least one other chicken businesses owner as well. Not surprisingly this chicken owner was a board member who sold Mary Ann her first chickens and got her started on her business. And for awhile, all was well. But then life in this peaceful corner of the country changed. We’ll talk to Mary Ann and get some of the details of why her dreams came crashing down and how she lost first one house and is now hanging on, trying to protect the second house she and her husband bought, from being foreclosed on. I’ll ask her what purpose her HOA serves and how it protects her when her closest neighbor is a mile away. I’m sure no one will be surprised to hear what happened to the only common area these property owners had. Maybe the fate of that park is the answer to why an HOA was even part of this neighborhood? Check out Mary Ann’s web site Blue Star Ranch . This lady is determined to help educate housing consumers about the perils of HOAs.
We’ve all heard how an alleged debt of a mere handful of dollars can balloon into a king’s ransom at the hands of an HOA and their attorneys. And no, I am not talking about investments for the homeowners. And certainly not about the empty (read bogus) promises of protected and enhanced property values. Sometimes these debts are due to a legitimate assessment that was missed for some reason. And all too often the “debt” is due to a fine imposed by the association for violating a recorded covenant, a silly rule that was conjured up on the spur of the moment or, increasingly, because the transgression in question violated someones esthetic sensibilities. In other words there is no rhyme or reason for the ensuing war among the neighbors. Notwithstanding all the accompanying sanctimony that attempts to validate these outrageous fees, penalties, charges and surcharges, they are solely for the benefit of the industry that feeds at the trough of the owners. For years the homeowners’ pleas for statutory relief and protection from these abuses have fallen on deaf ears. State legislators have failed to enact legislation to end these practices.
David Kahne joins us On the Commons. David is an attorney in Houston, Texas. His practice includes representing homeowners who find themselves on the receiving end of the malice that is increasingly common in residential associations. In addition to working with individual homeowners, David is an advocate for the rights of property owners. He has worked with legislators and advocacy groups in Texas and around the country. He testifies at the Texas State legislature for increased protections for the owners. We talk to David about this year’s legislative activities and the need for the proposed legislation. We also talk about a swimming pool case in Spring, Texas. A young couple put in a pool in their backyard and to protect their toddlers and the neighborhood children, they erected a fence around the pool. And the objection was? Well, tune in, David will explain it.