HOA on Rental Property

[Hector R.]

If you have a rental property in a subdivision that has an HOA, how do you deal with this? I'm assuming you pay for the HOA fee, and just account for it in your rent price. In addition, even though you own the home, the tenant is the one that actually lives in this house, so now they automatically become HOA members, correct?

[Suzette Murray]

Hi Hector,

In my experience as a property manager in So Cal, the owner is the one who owns the home, is on title and is the one that typically pays the HOA. Some HOA's have the ability to let the Tenant identify themselves as the person residing in the property and they must register with the HOA in order to acquire the key/s for the common area, such as the pool, clubhouse etc...

Your rent fee would still be market value and in calculating your cash flow you would take into account PITI (Principal, Interest, Taxes, Insurance) HOA and PMI if applicable. The HOA would not be expected from the tenant in addition to the monthly rent payment.

The owner is usually the member, not the tenant. It is important that an owner share with the tenant the HOA documents such as the CC&R's and rules before they move in and sign a document that it was received by the tenant. The rule and regulations must be a condition of the rental agreement since the Landlord would be held accountable for the renters infractions. A renter would communicate through the landlord any requests to the HOA. It would be advisable for the landlord to provide a copy of the rental agreement to to ensure compliance with the HOA's standards and for the purpose of emergency contact. Keep in mind the Board may demand termination of a tenant with multiple rule violations.

I hope this helps!

~Suzette