Is there government oversight over HOAs? Curious Texas investigates

If you’ve ever been told you cannot paint your house a certain color, install a type of fence or store your trash cans in public view on non-trash pickup days, chances are your neighborhood is governed by a homeowners association.

When people buy or rent a home in an HOA-governed neighborhood, they are asked to pay dues and sign a contract. This contract enables residents to access community amenities while granting the HOA the right to enforce regulations. Some of these regulations can be related to sanitation and cleanliness of the neighborhood, while others focus on aesthetics.

However, sometimes disputes arise between HOAs and homeowners, even resulting in lawsuits. Everything from unpaid fees to mismanagement of finances can be seen in Texas cases.

One reader asked Curious Texas, “Why is there not more government oversight on HOAs?”

Here’s what we found out.

Homeowners associations are community organizations made up of property owners, with many being considered nonprofits. They are governed by an elected board and funded by dues paid by property owners.

HOA boards outline restrictions and conditions in contracts, which homeowners and renters must sign and comply with when moving into the neighborhood. The HOA’s elected board members enforce these regulations, including how the HOA should govern itself and regulations on how property can be used and maintained.

Texas is home to more than 21,000 homeowners associations, according to the most recent data from Foundation for Community Association Research.

Dallas and Grand Prairie feature interactive maps on their city websites showing where current HOAs operate.

There are a number of Texas laws regarding HOAs, but the state government does not have enforcement power.

The Texas Secretary of State website says no state agency regulates homeowners associations. The office cannot “investigate or regulate the internal activities of HOAs and cannot take action against them for failing to comply with their governing documents and bylaws.”

Gregory Fell, attorney and founder of the Fell Law Firm, represents home, condominium and townhouse owners in Dallas-Fort Worth who pursue legal action against their associations. Fell said although there are laws regarding HOAs under Texas state property law, there “really is no state or governmental oversight.” He said they are governed by a “private contract” between homeowners and the HOA board, giving the HOA power to enforce the contract’s rules. HOAs are also able to fine residents who do not comply. Fell said these can quickly snowball and result in a lien on the property.

In Fell’s work, he sees two main disputes when it comes to fines and regulations: members not paying their dues — whether because of personal hardships or moving and not informing the HOA— and disagreements with fee increases. As for regulations, Fell sees disputes related to construction of fences, pools and other property modifications HOAs might argue were not approved by the board.

His advice to homeowners? “Be proactive when you realize there is a dispute, because the financial stakes will get higher and higher,” Fell said.

He also suggests residents be aware of the rules set by their HOA.

Related: Does your HOA have too much power? What homeowner associations can and can’t do

Within the Texas Property Code, the Texas Residential Property Owners Protection Act details rights for residents and outlines requirements for HOA board governance. Under these laws, homeowners have a right to transparency over items such as financial documents and election procedures.

HOA powers are limited. If the act is violated by an HOA, the property owner can sue the HOA in a justice of the peace court or a civil lawsuit in a district court.

Fell said the laws lay out the procedures HOAs must follow before taking enforcement action. However, townhouse and condominium associations have their own subsections under the law, he added. Although fairly similar, residents should check which association their home is governed by.

Since many HOAs are nonprofits, they must also comply with nonprofit laws under Texas Business Organizations Code, according to the Texas State Law Library.

Related: North Texas HOA tried to kick out Black residents. Some are now suing for discrimination

Beyond the aforementioned, and minimal, state regulations, associations’ also need to comply with the federal government’s Fair Housing Act, which says they must avoid discrimination while enforcing rules and offering benefits of membership as well as reasonable accommodations.

The U.S. Department of Housing and Urban Development refers these cases to the Justice Department for litigation, though in some cases, this litigation has been paused under the Trump administration.

Related: Case against North Texas HOA charged with racial discrimination stalls under Trump