Homeownership, often considered the pinnacle of the American dream, is increasingly entangled with the prospect of living in a homeowners association, or HOA. In fact, 80% of new homes sold in the West in 2022 were in HOAs.

For some, this is welcome news:

“An HOA fee is a small price to pay for easy access to walking trails and playgrounds.”

“Without an HOA you get stuff like untrimmed trees and people parking boats and RVs in their driveways.”

For others, living in an HOA is a nightmare:

“I’ll live in my truck before I subject myself to the rules and restrictions imposed by an HOA.”

“I got fined for having ‘non-neutral’ curtains …”

“I have to pay $250 a month for a patch of grass and pool I never use … and didn’t want in the first place.”

Considering the range of opinions, why are so many homes being built and sold in HOA communities? Are more people embracing a system that features less freedom and autonomy in exchange for a clubhouse? The reality is consumers are losing the ability to choose whether or not to live in an HOA-governed neighborhood — and it stems from strict zoning regulations.

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Strict zoning means more HOAs

To understand the connection between the proliferation of HOAs and your city’s zoning code, we first need to remove the idea that all builders start out wanting to build an HOA. Imagine you would like to build six affordable homes on an acre of land you own. However, a decade or so ago, the city zoning mandated that “only two homes can be built on an acre,” making your plan very unlikely.

The only chance you have for approval is to submit an application to the city to rezone your property. These applications are where HOAs come in.

You’ve learned that including amenities like playgrounds and parks increases the chances of your rezone getting approved. You’ve further learned that the zoning ordinance mandates the creation of an HOA for any proposal that includes these “communally owned spaces.” Consequently, despite homebuyers’ lack of interest, you’re forced to submit a proposal that uses valuable land on unnecessary amenities, creates an HOA, and commits the future buyers to the accompanying rules and fees.

Despite your best efforts to build six affordable homes, due to strict zoning regulations, your only option is to build fewer homes in an HOA system, drastically reducing the affordability.

HOAs in unexpected places

Strict zoning regulations don’t just contribute to the proliferation of HOAs in cities. Strict zoning also causes HOAs to appear in areas you might not expect them — small towns, areas outside of the city limits and even throughout rural and semirural areas.

In fairness, some of these HOAs are created voluntarily for practical reasons, such as paying for shared private roads to be periodically regraded and graveled or for a shared water system. Others, however, are created for the same reasons HOAs in the suburbs often are — a property owner simply wants to build something outside of the current zoning regulations.

The larger problem

If strict zoning only made it challenging for buyers of new homes to avoid HOA communities, it might be tolerable. The alarming truth is that zoning (of the sort that mandates homes be built on large lots) restricts freedom and property rights, worsens our housing shortage, and makes housing prohibitively expensive for our children, neighbors and employees.

Simply put, without zoning reform, the answer to the question, “Would you ever live in an HOA?” might be, “What other choice do I have?”

Lee Sands is the local government policy analyst at the Libertas Institute.