may govern your conduct. This can substantially affect
your ability to use your property. It could even restrict
your ability to rent your unit to others.
Before you purchase a townhouse or condo, you
should carefully read the rules governing the project
and consult your attorney if you have any questions.
Q: What should I do if I disagree with the association’s
rules?
A: If a dispute arises between you and the association
over any of the association’s rules, it may be necessary
to resolve the matter in court. Just because a provision
appears in the bylaws or rules does not automatically
mean that it is enforceable. But in most cases, a
rule will be upheld by the courts if it is considered
“reasonable.”
You may try to change the rules. Any change
in the bylaws or rules and regulations of the
homeowners’ association requires approval by the
members of the association or its executive board.
Each homeowner is entitled to vote.
Q: What happens if I do not abide by the restrictive
covenants, bylaws, or rules and regulations?
A: In any condominium or townhouse development,
an owner or the association may seek relief in court
against another owner who violates the association’s
covenants, bylaws, rules or regulations. In addition,
company to take care of maintenance, collect dues
and assessments, and carry out other day‑to‑day
responsibilities of the homeowners’ association.
The members of the association’s executive
board and the staff of management companies are
NOT required to be licensed by the N.C. Real Estate
Commission or any other state agency so long as their
management activities do not involve the sale or rental
of units. However, licensed real estate brokers who
manage homeowners’ associations must adhere to the
N.C. Real Estate License Law and related rules. This
includes keeping the collected funds of others in a trust
account, and maintaining records of all collections and
disbursement of these funds.
Q: Can the homeowners’ association do anything
about a developer who is causing problems in the
development?
A: If the developer is still in control of the association,
it is unlikely that the association will be able to
effectively take action against the developer; however,
the individual homeowners may be able to take legal
action against a controlling developer. If the developer
is not in control, the association can treat the developer
just as it would any other homeowner.
The North Carolina Real Estate Commission
P.O. Box 17100
Raleigh, North Carolina 27619-7100
919/875-3700
Web Site: www.ncrec.gov
15,000 copies of this public document were printed
at a cost of $.XXX per copy.
REC 3.31 12/1/11
owners in some condominiums and townhouses may
be fined by the association in accordance with either
the Planned Community Act or the Condominium Act.
These Acts give associations fining authority over the
owners of condominiums created on or after October
1, 1986, the owners of townhouses created on or after
January 1, 1999, and owners of older condominiums
and townhouses whose associations have properly
subjected themselves to portions of the applicable Act.
Even if an association has the right to impose a
fine, no fine can be imposed until the owner is given
notice of the alleged violation and an opportunity
to defend against the charge at a hearing before the
executive board of the association or a panel designated
by the board. Once a violation is found and not
corrected, the association may impose a fine up to
$100.00 per day for each day the violation continues.
And, if the owner fails to pay the fine and other charges
assessed, the association can file a lien against the
property of the offending owner and then sell the unit
through a foreclosure process.
Some problems may not be addressed by the
covenants, bylaws, or rules and regulations. In such
cases, you may have to contact a local law enforcement
official or your own attorney for assistance.
Q: What if I don’t pay my dues, assessments, fines, or
other changes?
A: If an owner fails to pay dues, fines, assessments or
other lawfully imposed charges, the owner’s property is
subject to foreclosure by the homeowners association
(even if the owner’s property is fully paid for).
Q: Can the homeowners’ association employ a
management company to assist in managing my condo
or townhouse complex?
A: Yes. A homeowners’ association, through its
executive board, will often employ a management
over time. You should find out who has the authority
to establish fees and assessments, whether there are
any limits on the amount that can be charged, and the
financial stability of the association. Are there sufficient
dues/reserves to pay for larger expenditures in the
future? Are there any pending or proposed assessments
of property owners?. You are less likely to be shocked
by fee increases if you have read this information prior
to signing a purchase agreement.
Q: Can an owner avoid paying assessments for the
common expense of the property?
A: No. All owners of condos (including the
developer) must pay their share of common expenses.
The same would also be true of townhouse owners if
there is a clear and definite statement in the restrictive
covenants specifying the purpose of the assessment and
the authority of the homeowners’ association to collect
the assessment.
Q: Can the homeowners’ association tell me what I can
and cannot do on my own property?
A: To some degree. The law allows you great freedom
to tailor the use of your property to your particular
lifestyle. However, this freedom is not unlimited and is
subject to certain restraints. A homeowners’ association
(or the developer) may be authorized by the declaration
to adopt bylaws or other rules and regulations which
Questions and Answers on:
Condos &
TownHouses
enforces the restrictive covenants. A homeowners’
association is usually established when the project
is created. The association will have an elected
executive board which will manage the association
and perform such tasks as enforcing the rules and
regulations and collecting the homeowners’ dues.
The developer, however, usually remains in
control of the association until the developer no
longer owns a majority of the units (or no longer
has the majority of the votes in the association),
or until a predetermined deadline has passed.
Q: Can my homeowners’ dues be increased?
A: Yes. The common expenses of your
development may include grounds’ upkeep,
building maintenance, insurance premiums,
property taxes and management fees, among
other things. When these expenses go up, the
cost is usually passed on to the property owners
in the form of increased dues and assessments.
The legal authority to increase dues and to assess
homeowners should be set forth in the documents
which govern the development.
Prior to signing a contract to purchase a
condominium or townhouse, you should examine
the governing documents to determine the amount
of maintenance fees and assessments you will be
obligated to pay and whether they may increase