Who Pays the HOA Dues on a Rental Property?

By
Real Estate Broker with Long & Foster REALTORS®, Gainesville, VA VA License # 0225089470

Who Pays the HOA Dues on a Rental Property?

When representing tenants, I am often asked, "Will we be responsible for the HOA dues if we rent this property?"  The answer is NO!  No way!  And even if the landlord wants you to, I'll convince them that's a BAD idea.  And I've had to do that a time or two over the past few years, which is astounding.  You'll see why if you think that tenants should pay the HOA fees directly as they are the ones getting the benefits of the HOA services and amenities. 

Home owner's associations are one the entities that can place a lien on your property for non-payment.  So as the owner, or in the case of the rental scenario-- as the landlord, you NEVER want to make another party responsible for something that negatively impact you or the clear title to your property. 

Case in point:  Right now I have first-time home buyers who are thrilled to have found a great home in Manassas Park.  Unfortunately, the owner of the property, who was transferred out of state, rented the property for four years.  The two sets of tenants in the home during those years were FRIENDS of the landlord.  And being a trusting sole, the landlord left his friends to pay his HOA dues.  Both sets of friends stiffed the HOA, probably thinking it was no big deal.  Unfortunately, the Seller is now having to pay off five liens that were filed against the house for non-payment of dues over those four years. 

Here's the sick part.  The monthly HOA fees were a max of $38 per month.  Over 48 months that's $1,824.  The liens total over $3,100!  Why?  Late fees and legal fees, of course.

Never put a tenant, even if they are your friend, in charge of HOA fees. 

 

 

 

Posted by

Chris Ann Cleland, Associate Broker- Licensed in Virginia, GRI, SFR, Northern Virginia Short Sale Specialist. Affiliated with Long & Foster, 7526 Limestone Drive, Gainesville, VA 20155.  To contact Chris Ann, call 703-402-0037 or email chrisann@LNF.com.  Or you can visit her website:  www.nvarealestate.net.

Header photos taken by Chris Ann Cleland.

The opinions expressed in this post are those of Chris Ann Cleland, not those of Long & Foster REALTORS®.

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Topic:
Lending / Financial
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Virginia Prince William County
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what happens if you dont pay your hoa dues
who pays the hoa fees in a rental

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Anonymous
Bruce

Hi Chris,

My HOA does not include any of the typical utilities. It includes lawn care, street maintenace and access to the pools, parks and fitness center. So in the Lease agreement it says tenant pays for all "Utilities and Services" and Landlord pays for "Taxes". My feeling is that the HOA comes under the definition of "Utilities and Services" and should be paid by the Tenant. Am I correct in my thinking?

Thanks,

Bruce

October 16, 2012 12:25 PM
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Chris Ann Cleland
Associate Broker, Northern VA
Long & Foster REALTORS®, Gainesville, VA

Bruce:  Add it to the rent and have them just write you a check.  If you put a tenant in charge of paying anything that can result in a lien on your property, you are asking for trouble.

October 16, 2012 02:03 PM
Anonymous
Janee

In our situation, the dues are included in our rent but the property management company isn't paying the dues.  The owner of our townhome is in the Military and are stationed over seas and the property management company is supposed to be taking care of things here.  The dues haven't been paid since the beginning of our lease, which was a year ago, and are now over $1000 behind.  What would our next step be? 

October 14, 2013 10:50 AM
Anonymous
Josie
I am a tenant of a property where there are HOA dues of around $250 for the owner which includes Utilities plus the usual condominium blanket insurance, maintenance, etc. In a desperate need to obtain get a rental lease one month out prior to returning to my home on the other side of the US, I was told before I looked it that the rent included water, sewer, and garbage collection which made me feel better about the rent price of $1200. Then after I looked at it and really liked it, I was told that I would be paying for $100 of the HOA Dues due to the utilities paid for by the HOA being included in the rent so my monthly rent paid to the owner would be $1300 instead of $1200. I just accepted it as I did like the place but was grumbling underneath thinking that I was deceived a bit. I found it through Zillow which does not include as many notes about fees as the public view of the MLS so I also assumed I had missed something. Turns out that now that we are leaving, she posted it as $1100 with rent including Water, sewer, garbage, cable T.V. I assumed she had lowered the rent and was not including any addition for the HOA fees since the utilities were included. Wrong! I have been very cooperative in showing the unit and one of the agents said I didn't have to answer it but asked how much did I pay in rent. He asked how much the HOA dues were as the listing agent had passed by and mentioned that it was $1100 plus HOA dues. I said I thought they were around $250 but they would have to ask the listing agent as I paid $100 added on to the posted rent. I then sent a note to the listing agent as I had been telling people the rent was the $1100 which included the above utilities. The listing agent replied saying that the rent was $1100 plus $200 HOA fees. She then said the HOA fees included the utilities plus the use of the amenities (small pool, spa, and small exercise room). She also said that I should refer people to her as I couldn't see all the terms on the MLS listing. Well by the showing agent's questions, he didn't either. The prospective renter was very positive about the property but haven't heard that he took it. The market is such that $1100 is fairly competitive rent but $1300 competes with only 2 of 215 rental properties and those 2 have more space, a double garage instead of a single, and are newer. One of them includes the same utilities as this unit. My point here is that it seems deceptive for a listing agent to post a rent and then add on "HOA Fees' which already includes part of what is said to be within the rent. In my opinion, the rent should be set by the owner so that they take into account the HOA fee expense. And, if the showing agent didn't see that within the MLS listing realtor notes, then it has to be some violation of the listing rules. Part of my interest in the future rent is that we have two months off left on our lease but can get released if they can rerent it. We decided to help generate interest with our own posting knowing we would immediately have to refer them to her. However, that was based on our understanding the rent was $1100 including the above utilities. Now, I'd rather eat the last couple months of rent than deceive people with misinformation and a price that is not competitive. Am I looking at this correctly that it may be a violation of realtor ethics?
April 13, 2014 09:55 AM
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Chris Ann Cleland
Associate Broker, Northern VA
Long & Foster REALTORS®, Gainesville, VA

Janee:  Unless there is a service you are missing as a result, there is very little reason for you to do anything.  If you are missing a service such as access to the pool, or cable and internet service, then I'd consult with an attorney and what to do next.

Josie:  I'm not sure this is a violation of the code of ethics or not.  It's hard when you don't see the violation in your own MLS first hand or know what other choices the agent may have had.  As for owners, they can absolutely choose to have a tenant pay their HOA or condo fees.  However, if they go unpaid, the owner is in trouble.

April 13, 2014 12:37 PM
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