Advice Needed: New Investor problem with HOA

[Brittany Alling]

Hi everyone!  
I need some advice! Recently I bought a townhouse- I am living in it for a year and then going to rent it out. This townhouse is in a HOA which I understand could get tricky. But when I looked at the HOA agreement nothing stated about not being able to rent the property out. The previous owner actually rented this property for 15 years!! I just got an email today stating that on September 1st ( my settlement date was September 22nd) there was a letter sent to the previous homeowner that stated the HOA wants everyone to vote on capping the rentals to only 22 properties- currently there are 19 properties already renting so there would only be 3 rentals left in the neighborhood. I don't know what to do because this was never disclosed to me when I received the HOA documents before settlement. I never would have considered this property if I knew this was the case.

Do I have a right to go back to the seller to understand why this was never disclosed? Also, does anyone have experience with HOA's and know if I can try to "reserve" one of the 3 spots left?

I appreciate all the advice I can get! 

[Greg M.]

Whether or not the seller should have disclosed this is debatable. Buyers should be aware that HOAs can change the rules at any time. 

I would suggest contacting the Board and requesting they add a grandfather clause to the rule. Basically, anyone who currently owns is exempt from the cap. When the unit gets sold, it now falls under the cap rule. Smart HOAs will do this as it greatly lessens the likelihood that an owner would sue the HOA.

If they refuse, have an attorney send a letter threatening to sue the HOA, Board, & Management Company as their actins diminished the value of your investment. No HOA wants a fight and they may bend just to shut you up.