Suburban Poverty Meets Homeowner's Associations

What will happen to Homeowner’s Associations in an America with increasing suburban poverty? It will be messy.

The Atlantic went so far as to label suburbs as “the new American Poverty”:

But the suburbs of Atlanta no longer hold just the promise of good schools, clean streets, and whitewashed homes with manicured lawns proudly displaying American flags. They are increasingly home to the very poor, who find themselves stranded in suburbs without the kind of transit or assistance that they might once have found in cities’ urban cores.

56 percent of people in poverty now reside in a suburb.

The Brookings Institute estimates that since 2000, two-thirds of poverty increases have occurred in the suburbs and 56 percent of people in poverty now reside in a suburb. In places like Atlanta, that number grew by over 150 percent. In addition, most suburbs are ill-equipped to deal with these increases.

Poverty in the inner-city isn’t something we should strive for, but if you're going to be poor anywhere, that might be a good place to do it. Advantages of urban life for the poor include access to transit, social services, and jobs. Poverty in most suburbs lacks all of these advantages.

We have no plans to deal with this. In fact, it isn’t even on our cultural radar. And it is likely that the far-reaches of suburbia are actually making people poor who might have otherwise have been middle class. We have no plan to deal with increasing suburban poverty and the dominate governing bodies of suburbia in many places – Homeowners Associations – are ill-prepared.

Here's a story: I had a friend who bought a house in Arizona at about the worst time you could buy a house in Arizona. It was a new community that was about half built-out when 2007-09 financial crisis happened. As with many places in Arizona and across the county, the subsequent years were not too kind. Home values tanked, people walked away from their properties, and squatters moved into abandoned homes.

While this was happening, the Homeowner’s Association (HOA) was ruthless. The neighborhood was diving into recession and homes were being abandoned, yet those who stayed were nailed with fines for minor infractions. My friend, who worked long hours, was guilty of not moving his garbage bin out of sight within the 12 hour allotted by the HOA. Imagine the frustration of seeing an abandoned construction site covered with debris for multiple months, and the being fined for not getting home from work soon enough to bring the trash can in.

Strict HOA rules and guidelines work when you have a home buyers who generally agree to uphold them. For example, mandating specific types of interior blinds that a homeowner can have doesn’t work with lower income families who might not be able to afford them. This actually happened. Somewhere outside Nashville a toddler was strangled by the cord to retractable blinds, the family removed them, replacing them with curtains only to be fined by the HOA for doing so.

Imagine for a moment that you have to commute two hours each way – from suburb to suburb - via the suburban public transit that barely exists. You can’t afford a car and property tax bill keeps increasing. Now, imagine having to pay $175 to your HOA because you didn’t move your garbage can in time, or you kept Christmas lights out for too long?

The answer is that you pay the fine. Why? Because in many states, HOAs have the authority to place a lien on your home for unpaid dues and fines. If you don’t pay, the Homeowner’s Association might soon own your home. In the State of Arizona, they can put a lien on your house for as little as $1,200 of unpaid fees.

My friend was able to pay his fine, but I feel that many future residents living in these types of communities covered by HOAs might not be so lucky.  As poverty begins to impact many American suburbs, homeowners associations should strive to help solve this problem, instead of creating further burdens on residents.

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