If a subdivision has any common element such as an entrance sign or open space and is less than twenty years old, it most likely falls under the Common Ownership Interest Act.  Most of us think of the Act as applying only to condominiums, but it can actually apply even to subdivisions where the roads, water, sewer  are public, built to municipal standards and the lots are fee simple.  Many buyers don’t understand that when they purchase a home, either new or pre-owned, they are governed by the declaration and articles that  initially incorporated the community.

     Buyers who purchase a home governed by the  Act have fifteen days to review and accept the public offering statement (for new homes) or the resale certificate (for pre-owned homes) before any seller can require that their earnest money becomes non-refundable.   These documents can be up to a hundred pages long and the reading can be tedious, but it is important to slough through it.  This document should include any amendments to the declaration, the current annual budget and minutes of meetings.   Most buyers are primarily concerned about where and for how long they can park their recreational vehicles and  how many pets they can have.  But buyers should keep reading  so that they understand the powers of their board, what the enforcement policies are for any violations of the covenants, codes and restrictions, including the ability to fine homeowners who do not abide by them.

     Larger communities frequently hire professional management to manage associations.  This is a good idea even for smaller communities because it provides a third, and hopefully, independent voice as to interpretation of the regulations and in some cases, designates architectural control to the property management company.    After all, it is difficult to tell your next door neighbor they can’t repaint their home that Easter blue color.    Some associations can actually hurt market value of their community by over regulation.  It is up to the association’s board to determine the length it will go to for enforcement.  Some associations fine violators; others only issue warnings. Some patrol their streets looking for violations; others only respond to complaints.  The  Municipality of Anchorage has limited resources and its zoning enforcement division usually  only handle violations that are a health and safety issue. If there is a HOA, that is the appropriate place to turn to about a barking dog.

     Some self-managed associations prepare their own public offering statement.  The public offering statement is the initial document for the first time home buyer and should be prepared by an attorney and not photocopied by the seller or developer.  Make sure you have an original document, not a copy.  It is very important that all amendments are current and that there is a current budget.  Some developers try to save the $300 cost of preparation by simply recopying a prior declaration.  This may mean that recent actions/amendments are not in this copy.  Buyers and their representatives should ask if the resale certificate or public offering statement was prepared by an attorney or property management company.    It is not a legal requirement to have done so, but it does ensure against any negligence or oversight on the part of the developer.

     Homes in Anchorage are expensive (some of the highest in the nation) and if your home has been built in the last twenty years,  it is most likely part of an association which holds an annual meeting and elects a board.  As a homeowner with a vested financial interest in the community in which you live, you should take the time out of your busy schedule to attend at least the annual meeting.  If you don’t go, someone else will make these decisions.  Your voice is important.   At times a board may not reflect the general will of the community it is elected to represent.  The reputation of your community with the public and the real estate industry is an important consideration in your future resale value.