The tragic news from Surfside Florida has the world stunned. How could such a thing happen? What caused a condo tower to collapse in the middle of the night? Mayors and local politicians are quick to go on camera and assure all that something similar could never happen in THEIR town. Why not? How can we be sure that a condominium like Champlain towers won’t just collapse in the middle of the night again? Why did the tower collapse killing so many people sleeping peacefully in their beds? What caused the building to pancake? There has been a lot of conjecture on what caused it, but so far, nothing definitive. Water intrusion, climate change, rusty rebar, and salt have been cited as possibilities. Maybe there is some truth to all of these causes, and perhaps a combination of them. But we need to know for sure, if possible. We need to know how to prevent something awful like this from happening again.
Evan McKenzie joins us On The Commons.
Evan is a law professor at the University of Illinois at Chicago. He studies urban politics, land use law and policy, and common interest housing developments, including condominiums, HOAs, and housing cooperatives. He is the author of several books and articles about common interest housing, he is the media’s go-to guy for comments on any housing issue that grabs the headlines. I am honored to have him On The Commons again. Who better to share his thoughts and ideas for the collapse of and how to prevent something like this from happening again? There are preventive steps that can and must be taken to ensure there are no repeat performances. Tune in and listen to what Evan has to say. As always, his ideas are full of common sense and easy to follow and understand. You won’t want to miss it.
Evan’s first book Privatopia is a classic. Below is a link to his second book Beyond Privatopia. Both books are available on Amazon.
Thank you for having Evan McKenzie as your guest! While I agreed with a great deal of what he says I do have some points of disagreement.
In my opinion, condos, townhouses, or Co-Ops will never be “affordable” housing because of the financial risks the buyers must take to become an owner. A low income earner or retiree living on social security cannot afford to be hit with a special assessment for repairs or lawsuits that the HOA board engages in. They are paying their HOA dues expecting that to be the most they will be required to pay and those will likely always increase.
I worked for three years on the Kansas Uniform Common Interest Owners Bill of Rights Act. Had that bill passed the way it was originally written it would have been fantastic! The HOA financials would have been accountable and embezzlements would have been very difficult for the dishonest board members and property managers. There were many other things in the original bill that would have benefited the home/condo/townhouse owners but the trade organization lobbyists were successful in convincing the legislators to remove those parts of the bill. After it was passed into law the lobbyists went back and worked to amend the bill making it pretty much worthless today. Even with the statute in place the property owners were faced with exorbitant legal bills to enforce the law.
Kansas had a case where the judge ruled those in townhouses/condos that depended on the HOA to maintain their property were considered consumers and protected under the Kansas Consumer Protection Law. (See jococourts.org/ Lytle vs Quivira Falls Community Assoc Inc/11CV05582) Owners in these types of housing do not have any say in the contractors that are hired, the scope of work, the costs, or any other factor. They must simple pay the dues and hope the work gets done professionally, which rarely happens.
To address construction timelines, I agree with Evan. Developers have construction loans with interest accruing daily. They need to complete those builds and get them sold as fast as possible. However, they do not need to use poor quality materials and cut corners! It takes the same amount of time to build with quality materials as it does with cheaper materials. Regardless of what materials are used they must be maintained and that’s where most maintenance-provided HOAs drop the ball. They fail to maintain the exteriors until the water penetrates the interiors causing massive destruction and rotting of the structural frame. This results in mold issues and over time and possible collapse of the entire structure.
Housing/construction is much like dentistry. If you keep your teeth cleaned and checked it’s likely the patient will not encounter extensive restorations. If those cleanings and checks are not done regularly or for forty years expect to lose the teeth or need extensive costly dental work. Do it or lose it.
Developers/builders now know that most owners will not pursue a legal remedy for faulty construction/damages because the cost of litigation will most likely exceed the cost of paying for repairs out of pocket. It’s in the best interest of the developer/builder to roll the dice and hope they never get sued. It is also difficult for the victimized property owner to find an attorney that will go up against the trade organization member attorneys. It most likely will be financial suicide for the owner to litigate with the HOA.
The HOA concept will never work unless and until there is a way to control the honesty and integrity of human beings. When the dues are stolen or misused, kickbacks to vendors are taking place, and board members are being given special treatment on their property, the average HOA owner is always going to come out on the short end of the equation.
I learned from my 15 year HOA experience. I would never own in another HOA if the place was given as a gift! One and done for me.