Tag: short term rental

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My Response To The HOA Clearly Asking To Rent Long Term

The HOA had their chance to email the homeowners to keep us up to date on all the things going on. Now time for some fun in my response back to them. Sometimes I feel the email etiquette I have learned from work makes some people surprised about how I well I format some of the stuff I say. I would love to deal with these things over the phone or in person, but the HOA and board have yet to want to speak in person or over the phone.

So now, I am stuck with email to try and get responses.

If you haven’t caught up yet, start from the beginning of the story to get the full craziness of this saga with my HOA!

My Email Response To The HOA

I wanted to make sure the HOA understood that I was taking my time before responding to their emails. Do I think they read the entire email response I sent, no. Absolutely not. If they did, they would have responded to my question the first time.

So here is my response in all of its glory:

Good afternoon HOA and Board Members,

I would like to address your email to the homeowners. First thank you for finally sending an email. Communication should be sent out once if not twice a week to update all homeowners on the situation. 
Now, to address the actual content of the message. It was honestly laughable. 
First, let’s discuss the difference between EO 20-91  Essential Services and Activities During COVID-19 Emergency and EO-87  (Emergency Management – COVID-19 – Vacation Rental Closures). 
  EO 20-91  Essential Services and Activities During COVID-19 Emergency is an EO that speaks directly to essential services. The only three references to vacation rentals pertain to Miami Dade County, see screenshot below. 
image.png
Yes, that is right, I hit Crtl+f and typed in vacation rentals to see exactly where it popped up. 
 EO 20-91  Essential Services and Activities During COVID-19 Emergency was extended and set to expire on 4/30 2020 unless extended by subsequent order. 
Now, let’s touch on  EO-87  (Emergency Management – COVID-19 – Vacation Rental Closures). As of 2:30pm EST on 4/8, this executive order is set to expire on Friday, 4/10. This means, vacation rentals, as of 4/10 can go back to business as normal and the HOA and board would be in direct violation of the law if you were to not allow guests to check in. This is pending any potential extensions of the EO that may happen from now till 4/10. 
This is how I would have worded this communication to homeowners. 
As of right now (enter current time),  EO 20-91  Essential Services and Activities During COVID-19 Emergency was extended through 4/30 unless extended by subsequent order. EO-87  (Emergency Management – COVID-19 – Vacation Rental Closures) preventing us from allowing new short term rental guests is set to expire this Friday 4/10. This is pending any subsequent order that could be signed into law between now and Friday. If no extension is signed to this order, we will be allowing new guests to arrive beginning on Friday 4/10. 
On another topic, would the HOA not permit me to rent my place out long term to abide by the law? Again, there are no options the HOA has offered for investors like myself, and the fact that there are no options and the email above asks for our money is well…a joke and very inconsiderate. I have paid and always will pay my HOA dues on time in full every quarter. Period. But asking for my money in an email communication like this is not a good look. 
My Thoughts On The Above Response
I am obviously biased in my response, but I feel I am being fair and pointing to straight facts. I am simply trying to find a way to rent my place long term that abides by the law. Period.
I am not trying to be difficult even though I know the HOA feels like I am just trying to be an ass.
What they need to understand is this. The resort is made up of 80% investors. Yes, this is an investment property. Not a vacation home or something that I have budgeted to just take money out of my pocket every month because I can’t rent it out. This has and always will be an investment property for me.
I don’t buy real estate to not produce cash flow for me. I only plan on buying assets in my life, and not liabilities. An asset to me means something that puts money back into my pocket. Right now, this investment property has become a straight liability. Normally, I wouldn’t be upset about this as I would say I would have control over most of my assets, but the fact that the HOA still feels like they have the authority to just stop me from renting has continued to frustrate me.
Why I Feel How I Feel
Again, I have never dealt with HOA issues in the past. Part of real estate investing is having to deal with the punches and things that come up from time to time. The main things I have accounted for are the most common capital expenses that will come up. Something I have not factored into my investment strategy is the fact that a HOA can just shut down the main entrance and prevent me from having any income. I still believe what they are doing is not abiding by the law.
Even more frustrating is how they talk about having to create an Emergency Budget to be able to handle these tough times. When, the reality is they should be saving money due to everything being shut down and people still paying their dues.
Something Hilarious Was Posted On The FB Group
Even more hilarious about the entire situation was something one of the homeowners who lives in the resort full time posted in the Facebook group.
Now, before I post exactly what they posted in the Facebook group, here is a little context on this owner.
This owner was one of the ones who belittled me saying how inconsiderate I was for wanting to still rent out my place long term and put the other homeowners in the resort at risk.
In tomorrow’s post, I will post the ridiculous comments made by this owner and the proceeding shenanigans in the Facebook group.
Things got out of control. And there was a ton of bickering. This one, I decided to stay out of. I will continue sitting on the sideline until I determine what I plan on doing with the property!

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Thanks again for all the support and continuing to come back each day for new updates in this saga!

Checkout the next part of the saga at the below link!

The HOA Facebook Group Gets Heated – Time For The Popcorn!

 

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HOA Sent An Email To All Homeowners To Pay Up!

This HOA has given me more issues than I care to even describe, oh wait, I have been pretty detailed in everything they have done to this point. The HOA sent an email to all homeowners to pay up. That is right, after this fiasco I have had with them to be able to rent my home out and being denied, and now they are asking all homeowners to pay up their quarterly dues immediately!

Get caught up on everything that has happened to this point following the links below starting from Part I:

 

I have been simply trying to pivot my short term rental business model to a month to month or long term rental business and the HOA has yet to allow me. My goal is to weather through this storm with enough rental income to cover my major expenses in each of my short term rental properties. This should be a temporary thing and I have been able to successfully pivot my real estate investments in each of my properties but this one property.

Here Is The Email From The HOA

This is definitely a long email, but I want to post the entire thing for you to get the full story. If you want to just get to the meat and potatoes, jump to the last paragraph! I have gone ahead and highlighted the part I couldn’t believe they added to the email.

Dear Homeowner,
As promised, this is an update on the impact of Coronavirus on the resort and how we are responding. Obviously, this is a fast-moving situation and while we will attempt to flag up pertinent issues as they arise, all owners are urged to listen to public broadcasts and particularly take the time to understand the implications of the Florida Governor’s Executive Orders (EOs), which detail the State’s response to the unfolding situation and provide instructions for citizens to follow.
The latest “Safer at Home” Order (EO 20-91) relating to “essential services and activities”, became effective April 3rd and expires on April 30th. This EO is wide ranging and we would encourage you to familiarise yourself with its contents. EOs can be found online by a simple search but we shall be posting these on the resort owners’ website for ease of reference. Please don’t ask our staff for guidance on the implications of the various orders, as they are not qualified to advise but if you are in any doubt, do contact the authorities for clarification.
Just for information, for those not actually onsite, all resort amenities are currently closed down and we are operating on a skeleton staff, with strict social distancing rules applied to those visiting our front desk. Our front gate remains covered 24/7, by our own staff during the daytime and by our regular contractor during overnight hours. These measures will be in place until at least the end of this month, when the position will be reviewed in light of prevailing circumstances and, of course, guidance from the authorities.
Also, in accordance with an earlier EO (20-87), in which the Governor temporarily suspended vacation rental operations, we have been refusing new rental admissions and our attorney has advised that we should continue to do so for the duration of the order and of course, any extension, unless for any rental which may be exempt, as prescribed by the Order. If, therefore, you are considering renting out your own property within the duration of the Order, perhaps to emergency workers coming in to help fight the virus, please contact our GM who will advise on what documentation will be required to comply with the Order but again, if you are in any doubt about compliance, please seek legal advice first.
Finally, your Board are currently working with our management team to find ways to mitigate the threat to our financial wellbeing, as we work our way through this crisis and to formulate an “Emergency Budget”, to give us a slimmed-down template to follow over the coming months. We are also looking at the available Government support schemes, which may benefit the HOA and our employees in the short term.
A further update on our financial planning will be provided in the next few days but in the meantime, thanks to all who have already paid this quarter’s fees and to those who have not yet paid, please do send yours in as soon as possible, so that we can maintain sufficient cashflow levels, not only to protect your resort asset but just as importantly, to keep our resort and its residents, guests and staff, safe and secure through these difficult times.
Thank you all for you co-operation and please stay safe,
Resor HOA Board

 

Overall Summary Of The Email

Like I said, this was a very lengthy email. Here are a few things I took away from the email.

First, they are finally listening to some of the feedback that I gave to them in regards to communication. I sent a clear email to the HOA/Board coaching them up to understand that they can’t close down the resort and then send 0 communication to any of the homeowners on what is going on. This is extremely unprofessional from a business standpoint.

Second, they continue to outline the two different executive orders signed into law by the Florida state governor. They even go as far as to tell people to seek their own legal advice if they have questions around what is legal and what is not. They know they are in hot waters right now for how they have handled the situation and they even “claim” they have seeked their own legal advice as well.

Third, they are seeking what they refer to as an Emergency Budget to get through this crisis! Umm…do you understand how a basic P&L statement works? For those of you who may not be familiar, a P&L is a profit and loss statement. This document outlines the expenses and income generated for a business. The HOA, by stating we need to create an Emergency Budget, is implying we will somehow be spending more money than previously by reducing the overall staffing and shutting down all the amenities in the resort. Last time I checked, when you close things and reduce the number of hours people are working, you save money. Not spend more. So I am still scratching my head as to how this crisis means the resort will be incurring more expenses than usual when everything is shut down. And no, they aren’t doing any special type of cleaning in the resort clubhouse. Mainly because it is shut down and everything inside is shut down. So saying they need more money to clean is not a valid point.

Now Time To The Part That Really Pissed Me Off

I continue finding it funny that the HOA thinks they are financial experts on this stuff. Here is the part that not only ticked me off, but also ticked off all the other investors in the Facebook group. This excerpt from the email:

“A further update on our financial planning will be provided in the next few days but in the meantime, thanks to all who have already paid this quarter’s fees and to those who have not yet paid, please do send yours in as soon as possible, so that we can maintain sufficient cashflow levels, not only to protect your resort asset but just as importantly, to keep our resort and its residents, guests and staff, safe and secure through these difficult times.”

So, let me make sure I am reading this right. You are requesting HOA dues from everyone so we can keep our resort and its residents, guests and staff, safe and secure during these difficult times? So you feel morally okay telling people to fork up their dues when you won’t allow me to rent my place long term based off the law allowing it?

Just want to make sure we are clear here. I also want to be clear about another thing. I paid my quarterly dues. On time and in full. Every time. I set everything on auto-payment and I didn’t for one second think to not pay my HOA dues. I pay my dues just like I am supposed to every quarter. These dues, I thought, gave me the right to own and utilize the community for a rental property investment it was meant to be; yet, now I am paying the exact HOA who is preventing me from renting my own place out?

Dang, this seems ass backwards. I can’t believe they had the nerve to put that at the bottom of their email while at the same time they are saying tough luck to all the investors who own in the resort. It isn’t the fact that they aren’t allowing me to rent short term, the law is clear on renting short term. I get that.

It is the fact that they abruptly shut everything down and have yet to offer any alternatives to investors who still have mortgage payments to pay. It is honestly things like this that I believe are going to cause the economy to tank in the next 3-4 months, if not sooner.

In tomorrow’s post, I will outline my response back to their email to the larger group. They continue to handle this situation in ways that amaze me.

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Thanks again for all the support and continuing to come back each day for new updates in this saga!

Checkout the next article at the link below!

My Response To The HOA Clearly Asking To Rent Long Term

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My Decision On Moving Forward With A Lawyer – To Pay Or Not To Pay, That Is The Question

I haven’t decided to pay a lawyer just yet to look further into my case. There are a few different reasons I have not moved forward with the lawyer. Before we get into those, let’s take a quick look at where we are at with everything going on. As a real estate investor, dealing with things like this will be a common occurrence. It might not always be a HOA that you have to deal with, but there are always things popping up that will cause issues.

Many individuals won’t buy in communities with HOA’s. I completely understand and respect that real estate investment strategy. Especially when you are going through and reading all of this, it doesn’t make you want to buy a property with a HOA. In my opinion there are good and bad things about HOA’s. The HOA haters will point exactly to this and say this is why nobody should buy in a HOA. I will give my limited view on HOA’s in a later post.

Paying A Lawyer

Time To Jump Into Where We Are In The Saga

The latest and greatest update was the response email I sent to the HOA. The response outlined my disappoint in the HOA and how they have handled the situation. This is an unprecedented time for the entire world. I am a firm believer that you learn more about people during tough times than you do when things are going well. To that point, these are tough times and the HOA and Board have been exposed to how they will handle tough times.

If you haven’t been fully caught up yet, start from the beginning to get all the craziness and context of everything that has happened to this point. Links below!

Trust me, it is worth the time to get caught up and hear the story from the beginning.

Why I Am Not (Yet) Moving Forward With A Lawyer

I have never been in the situation I am currently in. It has been a tough situation for many reasons. First, you have everything going on with the virus and the media. This has definitely scared a lot of people and rightfully so. Second, we had a governor who wrote and signed into law one of the most confusing Executive Orders signed into law in Florida. I thought my 8th grade reading level would be able to interpret a document of law, but I was wrong.

Lastly, I am trying to deal with a HOA that has historically been very difficult to deal with and horrible in their communication. I hadn’t seen any of that until going through this experience. An article I will write tomorrow will show even more into how horrible they are at communicating.

Here is why I am not planning to move forward with a lawyer just yet. At the end of the conversation with the local lawyer I asked for her advice on what to do. She immediately scrolled down to the bottom of the Executive Order to see when it was set to expire. The expiration date of the Executive Order was set for a few days out. She told me there wasn’t much point of paying her $385 per hour (or a “cheaper” associate $220 per hour) to dig further into the law and my HOA Bylaws to see what could be done.

The lawyer did mention there is a chance the Governor of Florida signs an extension of the Executive Order prior to expiration. No need to fret. She said to let the time pass and reach back out to her on the day after expiration.

How Much Would A Lawyer Cost

If I were a betting man, I would say the lawyer would use 4-5 hours of billable time to go comb through all the documents they would need to.

For the high side of that, at $385 per hour, I would be looking at $1,925 in money spent for the lawyer to look through everything and provide her assessment of the situation.

There are a few other loopholes I have not explored yet which I will write about in a later post. This could go a few different ways, so I don’t want to write about it until I have a clear understanding if I am going to explore that option.

In The Meantime, We Wait

For now, we wait. There isn’t much worth doing until the Executive Order expires.

Want to hear something crazy though?! Just 5 hours after my email response to the board telling them how horrible their communication has been…..guess what happened?

An email was sent to all homeowners. And boy did the f**k up another piece of communication.

In tomorrow’s post, I will share the entire email to you. Let’s just say I was amazed about how bad they are getting their wires crossed. Not only that, but how they ended the email was absolutely laughable! JUST WAIT!

Things are still heating up!

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Thanks again for all the support and continuing to come back each day for new updates in this saga!

To read the next blog post in this saga, click the link below!

Part IX: What I Think Of My HOA – The Unedited Version