Home Owners Associations (HOAs) are a non-profit association which is a corporation formed by a real estate developer for the purpose of marketing, managing, and selling of residential homes/lots or condominiums. It grants the developer privileged voting rights in governing the association, while allowing the developer to exit financial and legal responsibility of the organization, typically by transferring ownership of the association to the homeowners after selling off a predetermined number of lots. Membership in the homeowners association by a residential buyer is typically a condition of purchase and a buyer is not given an option to reject it. A monthly fee is charged to manage the common areas of the property. Most homeowner associations are incorporated, and are subject to state statutes that govern non-profit associations and homeowner associations. State oversight of homeowner associations is minimal, and mainly takes the form of laws which are inconsistent from state to state. With regards to condominiums, the HOA also controls how many rental permits will be available at any given time.
