By Deborah Goonan, Independent American Communities
Despite the fact that local newspapers and television stations are reporting on unsafe, unsanitary, and downright horrific living conditions of residents in distressed condominiums, most Americans remain unaware of this growing trend, and its contribution to a national affordable housing crisis.
One of the biggest social problems with so-called “affordable” condominiums is that they often struggle to pay the bills and keep up with basic maintenance and security. After several years of poor oversight and management, these communities find themselves unable to avoid blight and increasing criminal activity.
Some typical characteristics of chaotic condo associations:
- Buildings were constructed prior to the 1980s.
- Many were built as marginal or low quality apartment housing, later converted to condominiums marketed as “affordable” for first-time home buyers or retiring seniors on limited incomes.
- Although some units are owner-occupied, most owners live elsewhere and lease their unit – or multiple units – to tenants.
- Most residents in the surrounding community mistakenly believe the condominium complex is an apartment home community.
- The majority of tenants have low incomes and receive some sort of rent assistance
- Management of these associations tends to be poor – inconsistent enforcement of rules, ineffective collection of assessments (maintenance fees), with spotty or non-existent maintenance.
The Washington Post recently did an excellent article on struggling condominiums in the Washington DC area. (Condominiums in crisis: Financial troubles put many communities at risk)
Lynnhill Condominiums in Prince George County, Maryland, is yet another example. Families were recently told that Pepco will shut off electric utilities as of October 21st, due to unpaid bills. If electricity is turned off, the County would then be forced to condemn the condo complex, vacating all remaining residents.
Looking back at the history of Lynnhill, in February of 2014, WSSC also threatened to shut off water utilities for the same reason. The condo association was granted an extension and a payment plan. But then on Thanksgiving in 2014, a fire at Lynnhill destroyed several units and displaced 27 residents.
And yet, two years later, with charred condo units boarded up, dozens of building and safety code violations, and no working elevators, Lynnhill is still home to dozens of households. Why hasn’t Prince George County either enforced its building and fire safety codes or condemned the property?
Condo residents facing eviction over complex failing to pay bills in PG Co.
By Tim Barber/ABC7 Thursday, October 13th 2016
TEMPLE HILLS, Md. (ABC7) — Dozens of families at a Prince George’s County condo complex are being forced to think about moving.
“I don’t have nowhere to go. That’s why I’m here,” said Monique Lindsey, who lives at the Lynnhill Condominiums with her three kids.
County officials say the management company at the complex has not been paying the utility bills. If the utilities are shut off, residents will have to find a new place to live because living in the condos without utilities would not be safe.
Not an isolated incident
The general public needs to know that this same scenario is playing out all across the U.S.
Condominium associations have quietly replaced public housing. But instead of improving upon the deficiencies of the public housing model, instead of reducing segregation and increasing opportunity for personal wealth, Association Governed Housing has only made matters worse.
After all, most condo and homeowners associations in affordable price ranges are led by either poorly educated and unskilled boards or opportunists who seek to exploit their fellow homeowners. And sometimes that opportunist is the manager hired to oversee day-to-day operations.
The reason for that is simple, common sense: Associations on tight budgets simply cannot afford to employ high quality management. What’s more, privately contracted management is expensive, and only adds up to a higher cost of living for households living on small incomes.
And, by the way, economic distress is not limited to condominiums. Financial woes and poor management are also becoming more frequent in planned communities of detached homes or townhouses with homeowners’ associations (HOAs). Some examples recently featured are Pine Ridge HOA in Pike County, Pennsylvania; Centennial Park HOA in Las Vegas; Oasis Ranch in El Paso, Texas.
Without intervention, financially insolvent condo and homeowners’ associations will continue to deteriorate, creating more social problems and, ultimately, a significant burden on taxpayers.
Sooner or later, our housing policymakers need to acknowledge that the financial and governance model of Association Governed Communities is broken, perhaps beyond repair.
While Association Governance of common interest communities may work for real estate developers, and community association service providers (management companies, attorneys, and related maintenance and financial service providers), as evidenced by examples presented in this article (and countless others), it certainly isn’t working well for a significant number of housing consumers.
And those consumers hardest hit include older Americans, low income families with children, racial and ethnic minorities, people with disabilities, military families, and Veterans.