03.06.25

ISSUE # 111

CIC Info Bytes 03/06/25

🔊 Listen to the Podcast of Issue# 111

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Management Firm Labels Homeowners “Scofflaws”

• A management company with the slogan “minimizing cost and increasing values” labels homeowners as “scofflaws.”  Labeling homeowners (see our Ethics page) isn’t the answer.

HOAs in Pennsylvania: Why Covenants Matter and How to Handle Scofflaws — Onyx Capital Management | February 20, 2025

Secrecy: Friend or Foe?

• An interesting perspective that considers the benefits and challenges of open meetings and a transparent legislative process.

At the start of the Philadelphia Constitutional Convention of 1787, the delegates voted to keep their discussions secret. This, argued Pierce Butler of South Carolina, would prevent “licentious publications” of the proceedings, and would allow the framers to conduct their deliberations without fear of being second-guessed by uninformed or misinformed outsiders.

Some of the founding fathers took opposing views on the decision. James Madison thought secrecy was a necessary precaution, writing to James Monroe: “I think the rule was a prudent one, not only as it will effectually secure the requisite freedom of discussion, but as it will save both the Convention and the Community from a thousand erroneous and perhaps mischievous reports.”

But Thomas Jefferson wholeheartedly disapproved of the idea that lawmakers should shield their process from the very people for whom they were designing new laws. “I am sorry they began their deliberations by so abominable a precedent as that of tying up the tongues of their members,” he would later write to John Adams. “Nothing can justify this example but the innocence of their intentions, and ignorance of the value of public discussions.”

Over Jefferson’s objections, the delegates were sworn into secrecy, and their deliberations were conducted behind closed doors. (And not just doors: The windows of the Philadelphia State House were shuttered to keep out prying eyes.) If the founding fathers set the template for written constitutions, they also established the manner of their writing — by small groups of men, deliberating in private, with little or no consultation with the rest of the country.

Given the circumstances of their creation, it is remarkable that the US constitution and others like it have survived, albeit with some amendments along the way. Or perhaps their survival is the product of those circumstances: The secrecy allowed for relatively calm debate and dealmaking where full transparency, and the resulting burden of having to appease diverse views of the citizenry, might have made such compromise impossible.

We can’t know what document the founding fathers might have produced if they were writing it today, in an environment where Madison’s “thousand erroneous and perhaps mischievous reports” are multiplied many times over. These days, the process of drafting laws, especially in democracies or emerging democracies, is conducted in the open, under intense public scrutiny, with direct input from a wide range of people, running the gamut from journalists and opposition politicians to social-media influencers, activists and narrowly focused special interest groups.

In theory, such scrutiny should lead to positive inputs and an improved final result. However, as we’ve seen over and over again in recent years, millions of partisans contest every word and phrase of any proposed laws, rallying raucous support for their positions in the online public square that is social media, pressuring lawmakers to hold firm to positions and preventing compromise.

The resulting legislation is often flawed. Provisions will be pulling in different directions, each seeking to respond to disparate needs that have little to do with each other. It can also be subject to immediate change when the “other” side wins an election. It’s hard to imagine any law written under these conditions standing the test of time…

How Do You Write a Constitution in Today’s Conditions? (free 🔗) — Zaid Al-Ali | Bloomberg | February 28, 2025

2024 Colorado CIC Complaint Statistics

• Check out the latest complaint statistics compiled by Colorado’s DORA DRE HOA Information Center.  DORA DRE Community Association Complaint Statistics.  Interested in more?  View results from the 2023 - 2024 DORA Homeowner survey. 

Putting Community into your Condo, Co-op, or HOA

• Tales from Facebook - I

ORIGINAL POST: We have a mid-size HOA (250+/- homes).  A situation has come up where a homeowner would like to create a small native plant garden in a common area by our lake for educational purposes and to support pollinators. She has a neighborhood gardening club and they would be doing all the planting, watering, weeding, etc. 

Another board member has come up with reasons not to - the rain barrel she wants near the pool house would become HOA property and we'd be responsible for replacement if it breaks or is vandalized; if the garden is vandalized we'd be responsible for fixing it, etc. But neighborhood participation is so rare I'd like the HOA to support this effort and it's a nice idea…   — Sue F. | FB HOA Support Group | February 25, 2025

WAYWARD RESPONSE: We had a similar issue in our community and our attorney felt it would not be in the best interest of the community since once it is planted on HOA property it becomes the responsibility of the HOA.  It also creates a situation where if other homeowners want to do similar things on common property, the homeowners association would be compelled to allow other homeowners to plant things on common property as well.  While I understand the sentiment of this, I don’t think it would be in the best interest of the community.

COMMENTARY: There are many times you should ignore your attorney’s advice.  Allowing a community garden on common ground does not open Pandora’s box.  It is ALWAYS in the best interest of the community to promulgate community-oriented activities if there are owners and/or residents who are willing and able (and excited) to participate. 

ERROR!  DOES NOT COMPUTE!

• Tales from Facebook - II

COMMENT: 7 years an HOA board director, two as president and in three different HOAs and I went from knowing zero to having good experienced based opinions.  If a volunteer board follows the declaration they will not be able to act on most of what the owners submit in a survey anyway.  Surveys will generate controversy and a desire to “fix things” by people who have no clue what an HOA can and cannot do.  My position on this is counterintuitive but based on good experience.  Most people have no idea.  Many board directors have no clue as well.  Directors have fiduciary duties to uphold.  They can’t make decisions about this volunteer position based on the input of a bunch of people who have no clue.  — DeDe B. | FB | February 25, 2025

COMMENTARY: WOW!  What you see above is a scathing, irrational rebuke of homeowner members who both elect the Board and serve on it.

• Homeowner and resident satisfaction surveys are a great idea.

• State law and governing documents set minimum requirements that are neither best practices, nor a comprehensive guide about how to govern and operationalize your community.  Know Your Business: You MUST Go Beyond ‘The Basics’

Proactive Measures are Best

• Sage advice for every condo, co-op and HOA: implement proactive measures to ensure great governance and operations.  Laws and governing documents have no hands and feet.  Owners and directors are in the drivers’ seat.  Stay vigilant.

…While it appears from these recent charges and arrest that law enforcement agencies are now investigating and prosecuting such allegations more aggressively than in the past, what cases of fraud and embezzlement typically all have in common is communities ceding too much control to one or a few individuals with too little oversight.

Recovering funds lost to malfeasance can be extremely difficult, so communities should prioritize putting in place the most effective safeguards and preventative measures to help avoid becoming a victim. Some of the best practices include requiring two signatures on all checks, keeping the stockpile of blank checks securely locked away, avoiding community debit/ATM cards (which are prohibited by Florida law), conducting monthly reviews of all account and financial statements by multiple directors/managers, and maintaining adequate insurance coverage to protect against such losses. Associations should also conduct independent audits of all financial records by certified experts on a regular basis.

Community association directors and property managers have a great deal of control over the purse strings for the enclaves they serve, so the potential for fraud and embezzlement will presumably always be present. Residents who suspect any wrongdoings in their communities should turn to local and state law enforcement agencies for investigations, which are now much more likely to be pursued than in the past. However, to help avoid becoming victimized and having to turn to law enforcement and the justice system, associations should make effective use of these and other preventative measures and precautions.

Why it’s not enough for just the police to crack down on community association fraud — Shari Wald Garrett | Miami Herald Opinion | February 27, 2025

NOT In the Mail

• San Antonio, Texas: This story is a brilliant example of the power of persistence and public scrutiny.

Homeowners on the northeast side have been dealing with the absence of mail coming to their community mailbox for several weeks, prompting frustration among residents…The mailbox in question is near Jeffs Farm and Caramel Way in Bexar County.

Thomas and family have lived in the Meadow Park Homeowners Association near Kirby for almost a decade. Lately, he’s been struggling to find out why no mail has shown up over nearly the past month.  Thomas said he has four packages that have been deemed "undeliverable." “Very aggravating, because you have your W-2s coming, taxes coming, just different bills. Not everybody pays their bills online nowadays,” Thomas said.

The cluster box confusion began when he spotted a sign posted by the U.S. Postal Service on the front of the mailbox. The notice informed residents about apparent "vandilism," a word misspelled on the notice, and to pick up their mail at a particular post office off of East Houston Street. “So we thought it maybe would be corrected over time and here we are still in the same situation, no mail, no packages, anything,” Thomas said…

UPDATE: Impacted neighbors of the Meadow Park community in Bexar County are happy to discover mail delivery has resumed  just one day after KENS 5's initial report, which questioned USPS. 

For at least a month, no mail had been delivered at the cluster box unit off Jeffs Farm and Caramel Way. A sign posted on the mailbox indicated due to vandalism, residents had to pickup their mail at a post office more than 30 minutes away, serving as an inconvenience for many people, including Clifton Thomas.

On Thursday evening, Thomas alerted KENS 5 that the sign is no longer on the mailbox. Expressing gratitude, Thomas shared a photo of several pieces of mail, including letters and packages. 

San Antonio HOA grappling with undelivered mail for several weeks — Zack Briggs | KENS5 | February 26, 2025

Not-So Gated Community

• Southport, North Carolina: Gate request denied by the Southport Board of Aldermen.

The Cades Cove Homeowners Association in Southport sought permission to install a gate and restrict public access to their community.  Residents in favor of the gate cited concerns about speeding, safety, and increased traffic from nearby developments.  Opponents argued that the streets were necessary for public use and traffic management in the city….

…"The decision for this application is whether the Planned Unit Development Master Development Plan should be amended to include a gate restricting connectivity through the neighborhood," the staff report states. "Past events related to streets should not be part of the decision to create a gated community."

Southport's planning board and planning department found Cades Cove Homeowners Association's requests were not consistent with the city's 2014 Coastal Area Management Act Land Use Plan nor the city's unified development ordinance.

The Southport Board of Aldermen denied the community's requests, following both planning board and planning department recommendation to deny the request.

Brunswick homeowners lose battle to gate community — Savanna Temempff | Star News Online | February 25, 2025

Transparency Matters

• Virginia: Owners advocating for accountability and transparency. 

A group of Belmont Bay homeowners has filed a complaint with the Virginia Office of the Common Interest Community Ombudsman, accusing their homeowners association (HOA) board of violating transparency regulations. The complaint, submitted by KP Lau, president of Concerned Citizens United for Belmont Bay (CCUBB), alleges that the HOA board conducted business behind closed doors, failed to notify residents about key meetings, and did not follow its own communication protocols regarding land deals and rezoning discussions.

Belmont Bay Residents File Complaint Against HOA Over Transparency Concerns as New Development Breaks Ground

— Urlah Kiser | Potomac Local | February 24, 2025

Attorneys Lobbied for Developer Bliss

• Tallahassee, Florida: It all adds up when there’s $$$ involved.  Sound familiar?  It is!  Read Shameful Advocacy in Issue# 76 and The Association “Industry” Operates at Homeowners’ Expense in Issue# 77.

An influential group of real estate attorneys that advised Florida lawmakers after a residential tower partially collapsed in Surfside saw an opportunity to rein in condo associations, while realizing their advice would lead distressed unit owners in older buildings to sell to developers. 

Rather than focusing on what may have caused the Champlain Towers South to fail, attorneys on a task force of a Florida Bar law section encouraged the Legislature to force condo associations to save money for future building maintenance. The recommendation became a crucial component in the state Legislature’s response to the tragedy — and a driver of the burgeoning financial crisis for condo owners in South Florida and across the state.

With unit owners now seeking relief, Miami lawmakers in key positions in state government are pushing back, saying they won’t soften a law created to prevent another catastrophic building failure. But a Herald/Times investigation shows that experts who advocated for the key component of the law viewed it not necessarily as a means to prevent another collapse, but as an opportunity to force associations to invest in their buildings, knowing it would be financially impractical for a number of unit owners…

How Florida Surfside law hurts condo owners, helps developers — Alexandra Glorioso | Miami Herald | March 01, 2025

No Bailouts for Poor Laws

• Tallahassee, Florida: Prominent legislators decry “bailouts” for the poorly conceived “full funding” laws they enacted with a 2.5 year ramp to correct decades of under-regulation.

…With the Legislature discussing potential changes in condo laws, House Speaker Daniel Perez, R-Miami, and Rep. Vicki Lopez, a Miami Republican working on the issue, said new proposals won’t involve direct financial assistance…

…“I do have to balance that with my responsibility as the speaker and make sure that we don’t bail out and use taxpayer dollars for people that are in private homes,” Perez said Tuesday morning after an appearance at a Florida Chamber of Commerce Legislative Fly-In event at Tallahassee’s Donald L. Tucker Civic Center...

...“The Legislature is not in the business of bailing condo owners out, especially when they haven’t done what they should have done over the years,” Lopez said. “If you live in a single-family (home) and you have to replace your roof or your exterior doors and windows, I’m sure you’d be asking, ‘Well, where’s my bailout?’”...

Florida lawmakers say no ‘bailouts’ for condo owners — Jim Turner | WKMG News 6 | February 11, 2025

State Revocation of Master Insurance Policies?

• Tallahassee, Florida: Rubbing salt in the wound...

A Miami lawmaker is proposing to end state-run property insurance for condo associations that shirk compliance with new building-safety laws passed after a 12-story residential tower in Surfside collapsed in 2021, a move that would largely impact South Florida. Most condominium buildings three stories and higher must have had a building-safety inspection and study outlining recommended budgets for future building maintenance by Dec. 31 of last year.

But so far, most of the more than 11,270 condominium associations in Florida required to get the study for funding future repairs haven’t followed through, the secretary for the Florida Department of Business and Professional Regulation told House lawmakers in a panel discussion last week. There are no criminal penalties for non-compliance. Over the weekend, Republican Rep. Vicki Lopez, filed HB 913 — a 99-page bill refining the condominium laws that have been the subject of every legislative session since the Surfside tragedy. One of the provisions addresses the problem raised by the DBPR secretary last week.

Lopez proposes to bar the state-run property insurer Citizens from providing coverage to condominiums that fail to comply with the new requirements. She didn’t respond to a request for comment, but wrote on social media that the bill “addresses the need for modernized, efficient, and inclusive condo management, prioritizing safety and financial sustainability for Florida’s communities.” The bill also expands access to electronic voting and allows associations to take on loans or levy special assessments “without the approval of the membership” to pay for the now-required building maintenance and repairs.

Miami lawmaker proposes revoking Citizens coverage for non-compliant condos — Alexandra Glorioso | Miami Herald | February 25, 2025

Condo Owners Explain their Financial Pain

• Florida: Telling interviews with condo owners.

…More than 75 condo unit owners conveyed two emotions — anger and frustration — to the South Florida Sun Sentinel, which in early February asked the public to describe how they were being affected by rising condo maintenance costs.

Some owners are angry that monthly maintenance fees have doubled in recent years, thanks to increases in insurance costs and new laws enacted after the Surfside tower collapse in 2021 requiring condo associations to fully fund their reserves….

ADDING TENANTS TO KEEP UP WITH ASSESSMENTS

Doris Gustafson has never wanted to leave the home she bought in The Reflections community on Pine Island Drive in Davie back in 2008...

...But a near doubling of the monthly maintenance fees within the community in recent years — from $380 to $635, she says — has hit the 75-year-old retiree hard because she depends solely on Social Security for her income. And inflation-triggered increases in her benefit haven’t kept up with rising costs of food, medicine and transportation in addition to the maintenance fee hike...

...She has decided to take in a roommate to help cover costs. Sharing her unit will require her to move her artwork and supplies out of the upstairs bedroom she had been using as a studio....

SPECIAL ASSESSMENTS KEEP COMING

The first special assessment notice that Graham Brunk received for concrete restoration work at The Lakeshore Club condo building in West Palm Beach was for close to $9,000, he said, adding that unit owners were told that the painting and restoration company agreed to do the work for about $700,000...

...Initially, the company thought it would only have to remove sliding doors from a handful of units, he said. “But once they started — they worked on the building from north to south — they found a lot more units that needed this kind of work done.”

Suddenly, the job price had increased from $700,000 to $1 million, he said. “And then from $1 million to $1.3 million.”

Then the additional assessment notices started to arrive. “So my $9,000 turned into another $4,000 assessment. And another $4,000 assessment. And another $4,000 assessment. Every time it was like, ‘This is the last one.'”...

FANNIE + FREDDIE SAY ‘NO’

…Twenty-four hours after Nayara Silva listed her condo at Cypress Bend 2 in Pompano Beach for sale, she got an offer for her full asking price, she said.

But then the lender told her late last year that it couldn’t finance a loan for her buyer, she said, because 20% of unit owners in her building were more than 60 days delinquent on special assessment payments…

Tales from the Florida condo crisis: Homeowners describe hardships after cost hikes (free 🔗) — Ron Hurtibise | South Florida Sun Sentinel | March 02, 2025

Assessments Climbing In South Florida (and elsewhere)

• Florida: Don’t believe these numbers: they omit special assessments.  Reminder: mandatory assessments may include certain fees, but assessments are not fees.

Condo assessments jumped 60% in South Florida in past 5 years. Why higher costs are ahead — Rebecca San Juan | Miami Herald | November 11, 2024

500% Assessment Increase in 3 Years

• Winter Park, Florida: A five-fold increase in assessments over 3 years.

Residents at a local condo complex are grappling with skyrocketing HOA fees, with some seeing their monthly costs increase from $400 to more than $2,000 in just a few years.

Cindi Moran, a condo owner at Winter Park Woods, says her fees have surged dramatically since she purchased her unit in 2022…

The HOA fees were $400 a month when she moved in, and now they are rising to $2,081 going into 2025, she told us...

Winter Park condominium owners face skyrocketing HOA fees — Staff | Fox 35 Orlando | December 13, 2024

Condo Lifeline?

• Florida: The “Florida CAM Help Program” sounds like a hotline to save weary association managers from despair, but is actually financing for condos facing staggeringly expensive infrastructure projects.

Florida's CAM Help Program - the Condominium Association Rescue Initiative — Morningstar | February 26, 2025

• Los Angeles, California: Wildfire destruction was predictable.

94% of destroyed properties identified to have had severe or extreme risk of wildfire | Web — First Street | February 19, 2025

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La Jolla, California: Could roof-mounted HVAC systems catch fire?

In the wake of the recent outbreak of fires in Southern California and a smaller fire in the Seahaus La Jolla condominium complex in Bird Rock, some residents there are worried that another fire might be looming.

According to those residents and an outside contractor, some rooftop heating, ventilation and air conditioning systems at Seahaus are inappropriately sized for the wiring there. One of the units caught fire in December, leading to concerns that another might catch fire if they’re not replaced.

However, the board of the Seahaus La Jolla Owners Association argues that despite the fire, there is no safety hazard associated with the equipment.  The homeowners association hired a licensed electrician to do an inspection in January, and “no fire hazards were identified in any of the HVAC units,” according to Craig Combs, general legal counsel for the HOA.

Seahaus, built in 2005, is three stories tall and contains 138 condos in nine buildings in the 5400 block of La Jolla Boulevard.

At some point in the past 10 years, Seahaus’ rooftop HVAC system needed to be replaced and the residents chose vendors to do the job, resident Tracy Wight said.

The residents “trusted their vendors to understand the wiring on the roof” in selecting new HVAC units. The complex is wired for 2-ton air conditioners, but several 3-ton systems were installed. There are nine remaining.

As a result, Wight said, “wires were not connected properly, air conditioning units were not in the right place, we had air conditioning units that did not have insulation around them or were oversized.”

Then in 2023, the association announced the roofs needed to be replaced at the condo owners’ expense. As part of that process, an electrician who lives in the complex went on the roofs to look at some of the equipment there. The electrician determined that the 3-ton HVAC units were too large, too close together or not stable and alerted the board to his concerns last April.

Bird Rock condo residents worry about fire risk from rooftop HVAC units — Ashley Mackin Solomon | La Jolla Light | February 22, 2025

• The national housing market outlook says goodbye to bidding wars and welcome to increased inventory.

The bidding wars of the past half decade are fading in many parts of the country. Instead, today’s buyers say they are finding sellers willing to lower prices or throw in extras to sweeten the deal. The average home is now changing hands for 2% less than the price on the listing, according to real-estate brokerage Redfin.

Behind the shifting power balance is a growing supply of homes on the market. New listings increased in January by almost 5% versus last year, according to Redfin. By one measure, there is more for-sale homes than at any point in six years.

At the same time, demand is easing because many would-be buyers are deciding not to purchase at today’s prices, which are up sharply from a few years ago…

Home Buyers Are Finally Getting the Upper Hand Again — Veronica Dagher | WSJ | February 22, 2025

California: Bidding wars in Silicon Valley!

In California’s Silicon Valley, it often takes millions of dollars just to score a fixer-upper.

High mortgage rates may be snuffing out demand for homes elsewhere in the US, but for the area’s many software engineers riding the tech stock boom, and crypto millionaires cashing in gains, none of that matters. Tracy Hsu, an agent in Cupertino, tells her clients that it’s about bidding high enough to win.

Last month, Hsu helped a buyer land a dated three-bedroom ranch in Saratoga — a short drive from Apple Inc.’s headquarters — for $4.5 million, with plans to tear it down and start fresh. More recently, a bungalow hit the market in the same town for $3.9 million and a client, against Hsu’s advice, offered only $600,000 more. Someone else swooped in and put it under contract for $4.6 million, she said.

“When we write an offer, we don’t look at the asking price,” Hsu said. “It’s meaningless.”..

Silicon Valley’s Hot Housing Market Fuels Bidding Wars  (free 🔗) — Prashant Gopal, Biz Carson, and Alicia Clanton | Bloomberg | February 26, 2025

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Vail, Colorado: A condo lottery.

The Town of Vail is pleased to announce that we are now accepting applications for a community lottery drawing for the sale of a Vail Commons Condominium in West Vail. This listing is in partnership with The Valley Home Store of Eagle County, who is the transaction broker for the approved buyer. Additional property information, a photo gallery, qualification information and a link to the online application can be found at 2106 Zermatt Lane Unit B — The Valley Home Store. The deadline for submitting the Town of Vail Lottery application is 3 p.m., Friday, March 7…

Town of Vail accepting applications for Vail Commons Condominium lottery — Staff | Real Vail | February 28, 2025

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Seattle, Washington: 50 shades on sale for $11.5 million.

“The Escala penthouse in Seattle gained international fame as the fictional home of Christian Grey in the Fifty Shades of Grey series by E.L. James,” a news release on the residence said. “While the Escala is a real luxury condominium building in downtown Seattle, the penthouse as described in the books and movies is a fictionalized version, exaggerated for dramatic effect.”...

…In the “Fifty Shades of Grey” books, the home included features like a private elevator, piano, a “Red Room of Pain” (soundproof room) and a rooftop terrace, according to the release.

The real-life residence doesn’t include those, but the building was featured in the trilogy.

“For the Fifty Shades movies, Escala’s exterior was used for establishing shots, but the penthouse interior was filmed on a set,” the release said. “The real penthouses in Escala don’t have Christian Grey’s exact layout, the ‘Red Room,’ or some of the ultra-high-tech features seen in the books.”...

Penthouse that inspired ‘Fifty Shades of Grey’ up for sale in Seattle — TJ Macias | The Seattle Times | February 20, 2025

Built Environment

• New York City, New York: Eclectic taste.

In the 1980s, graphic and furniture designer Dan Friedman began living what he called “a double life.” A pioneer of postmodernism, he’d become a regular among downtown galleries and clubs; his friends included such artists as Keith Haring, Jean-Michel Basquiat, and Kenny Scharf and photographer Tseng Kwong Chi. But by day, he consulted with corporate clients; for around 20 years of his life, he lived not in a bohemian Soho loft but on Fifth Avenue in a classic white-brick West Village co-op.

Inside, though, was another story. “It was a really humorous contrast,” says the gallerist Jeffrey Deitch, a good friend and collaborator of Friedman’s. “But it was also very much like Dan — on the outside, very proper, and then in his apartment, crazy and inventive.” What began as a conventional one-bedroom in a building where his neighbors included Mayor Ed Koch and activist Bella Abzug became his personal fun house…

Dan Friedman Created a Fun House in a Fifth Avenue Co-op — Wendy Goodman | Curbed | March 03, 2025

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Corporate property debt is back in vogue-ish.

Investors are back to buying office bonds after about two years on the sidelines, committing billions to deals that refinance New York City towers even as the future for older, less well-known buildings remains unclear.

From the Seagram Building to The MetLife Building, owners of Manhattan’s trophy offices — prime buildings in desirable locations — have sold a slew of commercial mortgage backed securities in 2025. That builds on momentum from the fourth quarter of last year, when there was a $3.4 billion CMBS sale tied to the Rockefeller Center. 

Sales of these bonds were dead for much of the last two years, but this month, investors have paid more than $4.5 billion to buy bonds that were backed entirely by US offices — the highest figure in at least a half-decade. In February, these securities accounted for 35% of single-asset commercial mortgage bonds sold, according to Deutsche Bank, based on three-month trailing averages. That’s the highest percentage since 2021.

Investors have warmed up to the market as supply has increased. Premiums on some riskier portions of the CMBS deals have compressed rapidly, dropping from 325 bps for last year’s Rockefeller deal to below 200 bps for this month’s Seagram Building deal, according to data compiled by Bloomberg News…

NYC Office Buildings See Resurgence as Investors Pile Into Bonds — Emmanuel John Milton and Scott Carpenter | Bloomberg | February 27, 2025

• Is a pivot afoot for the FOMC?

Investors in US government bonds are starting to bet the Federal Reserve will soon need to pivot from worrying about sticky inflation to fretting about slowing economic growth…

…Traders this week resumed fully pricing in two quarter-point cuts by the Fed this year, and most of a third one next year, to a level of about 3.65%. Morgan Stanley says if the market prices in a drop to 3.25%, the 10-year can breach 4%. The bank expects inflation data to be released Friday — the prices indexes for January personal consumption expenditures, or PCE — to show a decline in the pace of price growth that could be decisive…

Treasury Investors Anticipate Fed Shift From Inflation to Economic Growth Risks — Liz Capo McCormick | Bloomberg | February 26, 2025

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Consumer sentiment says inflation will remain higher for longer.

US consumers’ long-term inflation expectations rose to the highest level in almost three decades on concerns President Donald Trump’s tariffs will translate into higher prices.

Consumers expect prices will climb at an annual rate of 3.5% over the next five to 10 years, according to the final February reading from the University of Michigan. The rate is the highest since 1995, based on data compiled by Bloomberg, and was almost entirely driven by views among survey respondents who are Democrats.

Partly as a result, the consumer sentiment index dropped to 64.7 from 71.7 in January — lower than analysts anticipated. Here, too, the results were politically polarized, with Democrats and political independent respondents driving the decline.

US Consumers Long-Run Inflation Views Rise to Highest Since 1995 — Jarrell Dillard and Augusta Saraiva | Bloomberg | February 21, 2025

University of Michigan: Consumer Sentiment (UMCSENT) — FRED 

Is January’s consumer pull-back a one-off or a sign of what’s to come?

US consumers unexpectedly pulled back on spending on goods like cars in January amid extreme winter weather, and a slowdown in services, if sustained, may raise concerns about the resilience of the economy.

Inflation-adjusted consumer spending fell 0.5%, marking the biggest monthly decline in almost four years after a robust holiday season. The drop in outlays was driven by an outsize decline in motor vehicle purchases, and drops in categories like recreational goods.

“Consumers took a breather in January. The key question is whether this is the onset of a more cautious consumer in 2025,” said Gregory Daco, chief economist for EY. “Spending on the services front was modest, so it may be a little bit more than just a post-holiday breather.”...

US Spending Drops on Cold Weather; Inflation Gauge Offers Relief — Augusta Saraiva | Bloomberg | February 28, 2025

YES: Condos, Co-Ops and HOAs are Hyper-Local Governments

• Dixon, California: Know before you buy!  BUT also know this: hiring a management company does not solve the world’s problems.

If you’re considering a purchase in a Dixon development, you might want to check and see how it is “governed,” especially if it has a homeowners’ association (HOA)...

Considering Your Neighborhood Government? — Debra Dingman | Independent Voice | February 19, 2025

Homeowner Prevails on Public Parking in Small Claims

• King County, Washington: Fresh off the docket

🔊 AUDIO: 24CIV20740 - King County Small Claims - Phan v. Westview Meadow HOA

🗄️ CASE: 24CIV20740 - King County Small Claims - Phan v. Westview Meadow HOA — King County Superior Court Small Claims | February 27, 2025

Trouble in Texas

• Near Austin, Texas: Neighbor disputes.  Covenant collisions.  All out war.

…Saratoga Hills is fairly typical, a maze of cul-de-sacs with whimsical street names like Gato del Sol. There are 155 homes—minimum size: 2,500 square feet—each on at least one and a half acres. As one resident put it, “We have the space that allows us to enjoy our acreage and our freedoms.” …

The Battle of Saratoga Hills finally seemed to be drawing to a close, or at least a standstill. But then, on November 13, a week after Donald Trump’s election triumph, a bombshell dropped on one of the community’s Facebook pages. 

For nineteen months, the quiet Dripping Springs neighborhood of million-dollar homes on cul-de-sacs had been engulfed in a dispute both trivial and all-consuming. It had started like many homeowners association fights do—as a mundane quarrel between neighbors who had once been friendly. Saratoga Hills had had its fair share of beefs. Kerfuffles over whether to allow fireworks. Accusations of HOA indifference to speeding. The contentious matter of the unfenced pool. This particular feud—over backyard swimming lessons—seemed no more consequential. Then it turned into something else entirely: an escalating series of accusations of stalking, lying, harassment, and tyranny—and, eventually, a lawsuit. And then, to almost everyone’s astonishment, possible legislative action.

“It may have begun as just a silly, petty neighborhood squabble, but we certainly feel it has gotten much bigger and, frankly, more sinister,” said Saratoga Hills resident Alexis Gallivan. As she explained to me, there’s a reason she and her neighbors pay a premium to live in a gated community. The gate, she said, “keeps the riffraff out, it keeps the noise out.” But now the chaos was coming from inside…

The Neighborhood Dispute:

• The article details a prolonged and escalating conflict within the Saratoga Hills homeowners association (HOA) in Dripping Springs, Texas.

• The dispute originated from a disagreement between neighbors, the Inglishes and the DeLeons, over Shanda DeLeon's backyard swim lessons.

• The Inglishes complained about the noise and traffic caused by the lessons, claiming they violated HOA rules prohibiting commercial activities.

• The DeLeons initially claimed the lessons were for friends and not commercial, leading to accusations of misrepresentation.

• The conflict escalated to include accusations of stalking, harassment, and legal action.

HOA Involvement and Escalation:

• The HOA board, led by president Justin Jackson, became involved, leading to further conflict and accusations.

• The board's efforts to resolve the dispute resulted in further animosity, with both sides accusing the other of wrongdoing.

• The conflict spilled over into social media, with accusations and counter-accusations exchanged between residents.

• The board had to deal with complaints of bullying and sexism.

Legal and Political Ramifications:

• The DeLeons filed a lawsuit against the HOA board members, alleging defamation.

• Shanda Deleon was elected to the Dripping Springs ISD school board.

• State Representative Carrie Isaac filed House Bill 1133, which would prohibit HOAs from banning backyard swim lessons, at the urging of Shanda Deleon.

• The DeLeons eventually withdrew their lawsuit, but the underlying tensions remained.

The Neighborhood Spat That Went Nuclear — Forrest Wilder | Texas Monthly | March 2025, 2025

ADUs Prohibited

• California: As discussed in Issue# 64, new laws allowing ADUs are no match for covenants running with the land.

Adam Hardesty insists he wanted to do everything by the book.  Before moving forward with his plans to convert the garage of his three-story condo into a ground-floor apartment, he canvassed local architects and engineers to make sure a kitchenette, a bedroom and a bathroom could all be packed safely and legally into just 417 square feet.  He pored over local zoning maps, checked with the city of Carlsbad and got himself a building permit.  He sought and received the blessing of many of his immediate neighbors.  He even emailed a planner at the state’s housing department to get his take on whether he was legally entitled to build what California law refers to as an “accessory dwelling unit.” ...

...What he didn’t count on was opposition from his own homeowners association — if only because he’s also the HOA board vice president.

Hardesty floated the idea to his fellow board members late last summer. What followed was months of sternly worded legal missives, deadlocked negotiations and a heated battle over property rights that has pitted neighbor against neighbor across the Mystic Point Homeowners Association’s bucolic hillside subdivision along the coast north of San Diego.

At the center of the debate is among the most divisive questions in California politics: Who has the final say about what gets built where?...

No new ADUs here: When California law and homeowner association rules collide — Ben Christopher | CalMatters | February 21, 2025

Bad Behavior Begets Punitive Damages

• California: The attorney who shared this stated that it is the largest known award in California against an HOA and its president by a member for fraud and elder abuse.  We first covered this case in Issue# 92.

— 19CV349909 Ridley & Shen v. Rancho Palma Grande & Moritz | Judgment | 02/28/25

— 19CV349909 Ridley & Shen v. Rancho Palma Grande HOA and Moritz | February 26, 2025

— Access the full Santa Clara County Superior Court Docket  | Appellate Link

Geothermal Jitters

• Aspen, Colorado: Are geothermal boreholes expressly permitted by Colorado State law?

A Red Mountain property owner intending to install a geothermal system as part of a home-construction project has met opposition from the neighborhood’s governing association in a dispute now in the courts.

Court filings from attorneys representing the property owner, Seattle-based Gaspen Associates LLC, allege the homeowners association is unlawfully obstructing their attempt to install a geothermal heating system for a new 12,608-square-foot house to replace the existing one, roughly 5,000 square feet and eyed for demolition. 

The property’s address is 960 Willoughby Way, which is located on lower Red Mountain, one of Pitkin County’s most expensive areas for residential real estate. The property in question has a fair-market value of nearly $18 million, according to the Pitkin County Assessor’s Office. 

“Colorado law expressly states that a homeowners association … cannot stop installation of an energy efficient system like the geothermal system Gaspen intends to install,” said a petition requesting the appointment of a mediator, which was filed Jan. 23 in Pitkin County District Court.

According to Pitkin Green Homeowners Association, however, Gaspen has yet to support their position that the system is energy efficient but has indicated that installing the system could demand up to nearly 40 boreholes drilled on the property. The HOA also wants a better understanding of why the proposed system is necessary, arguing that just as effective but less-intrusive options are available. 

“At the heart of the disagreement between the (HOA) and Gaspen is the stated intention of Gaspen to drill as many as thirty-nine boreholes for the purpose of installing a ‘geothermal system.’ Missing from the Petition are detailed plans for such a system,” said a Feb. 18 response filed by the Pitkin Green Homeowners Association, which has 39 lots under its jurisdiction…

HOA pushes back on Red Mountain geothermal project — Rick Carroll | Aspen Daily News | March 03, 2025

The HOA Sand Trap

• Lynden, Washington: Five years of litigation has cost millions and this case has now been appealed to the WA Supreme Court.

Hillius v. 18 Paradise LLP, et. al

The sand traps at the Homestead Farms Golf Course are barely recognizable as such — visible from the patios of many residents in the adjacent Lynden subdivision, the bunkers are rocky and filled in with weeds, untouched by golfers and grazed over by a large flock of migratory wigeons. On the course, which has been closed since August 2023, the greens are fuzzy with grass growth and dotted with thistles, and the ponds are succumbing to cattails.  

“It makes me want to cry,” said Ada Wiersma, 88, who has lived in Homestead for 25 years and used to golf regularly with her late husband, Don. Her backyard abuts the course and she can watch from her breakfast nook as waterfowl enjoy the untended links. 

The deterioration of the 18-hole course is the most conspicuous reminder of a class action lawsuit over open space maintenance fees that has spanned nearly five years, caused rifts in the community, ended without clear resolution and has now been appealed to the Washington Supreme Court. 

The parties entangled in the lawsuit — the golf course owner, the management company, the City of Lynden, the plaintiffs, the class members and the intervenors — have spent millions on legal costs, while the sale of the course, listed for $3 million in 2021, has been hindered by litigation…

Empty, weedy Homestead golf course in Lynden is striking reminder of 5-year legal fight — Julia Tellman | Cascadia Daily News| January 18, 2025

Illinois Open Meetings

• Illinois: Also see Issue# 100.  Get to know your state law, including how Board members communicate with one another.

Condo boards may discuss business outside of meetings only in certain cases — Howard Dakoff | Chicago Tribune | February 23, 2025

• Please peruse the 300+ bills circulating through state legislatures this year!

• MINNESOTA: Bi-partisan support for homeowner-centric state law reform.

Lawmakers introduce bipartisan bill to rein in HOAs — Madison McVan | Minnesota Reformer | February 26, 2025

House lawmakers show support for legislation limiting reach of HOAs — Margaret Stevens | Minnesota House of Representatives | March 04, 2025

Lucero, Legislators Introduce Bipartisan Homeowners Association & Common Interest Community Reform Package — Minnesota Senate Republicans | 03/02/25