Limiting Number or Percent of Rentals in HOA

[aldaron]

In order for a condo to be qualified for FHA/Fannie/Freddie financing 51% of condos must be owner occupied. The only way to enforce that is for the HOA to have such rules and enforce them. If condos on the lower end couldn't qualify for FHA financing then the only pool of buyers would be cash/investors and slumlords. It keeps the communities property values up and upkeep on the properties too.

 

[LdiJ]

In order for a condo to be qualified for FHA/Fannie/Freddie financing 51% of condos must be owner occupied. The only way to enforce that is for the HOA to have such rules and enforce them. If condos on the lower end couldn't qualify for FHA financing then the only pool of buyers would be cash/investors and slumlords. It keeps the communities property values up and upkeep on the properties too.

51% is significantly different than a 75% requirement to amend CC&Rs. Although I am not sure that I agree that condos not being eligible for FHA financing means that no financing at all would be available.

 

[aldaron]

Where I'm located a lot of older condo's are priced in the 150k to 300k range. Most folks who use FHA don't have the required down for a private lender. It's a lot easier to move a unit if the HOA is FHA certified to be in compliance with the 51% owner occupied rule than when not in compliance. Another issue to be in compliance is a certain amount of reserve funds to be in the bank.