HOA Needs a Place in the Law

A foundational question about common-interest community (typical called HOAs spanning single family residential, condos and combinations therein) is: what kind of legal thing are they? The value in that answer is: Has the law supplied the safeguards, limits, and accountability that should accompany private entities exercising governance power over homes?

The questions matters not as an academic exercise, but because modern HOAs are now asked to do far more than originally anticipated and exercise powers that look increasingly like public a few governance, while continuing to be justified as private contracts. NVHOAReform seeks to open a conversation about the unfinished legal architecture of HOAs.

For a deeper doctrinal background — including how courts, regulators, and Nevada statutes lean on contract analogies despite HOAs’ governing power — see post HOAs Are More Than Contracts: Legal Fiction and Institutional Interests Work To Stifle Reform.

The Discomfort Is Structural, Not Incidental

The discomfort many homeowners feel with HOAs is not simply about a few bad actors or weak enforcement. It arises from a deeper structural ambiguity about where entities with compulsory governance authority belong within the law.

Homeowners associations are everywhere, yet they sit awkwardly in the legal system. They are not governments, but they exercise powers that feel governmental and are often labeled “quasi-governmental.” They are not purely private contracts; consent is frequently a legal fiction, rarely voluntary in any meaningful sense. They are typically organized as nonprofit corporations, but that label supplies an administrative shell more than a coherent legal identity. Unlike ordinary nonprofits, HOA membership is tied to ownership of a home, exit usually requires selling the home, assessments are compulsory, rules bind future owners, and enforcement may reach the home itself through fines, liens, and foreclosure. The nonprofit form may provide familiar corporate machinery — directors, officers, bylaws, meetings, and votes — but it does not explain how private governance power should be exercised, constrained, or legitimated over unwilling or future participants.

Proper HOA fit under the law?

Servitudes underlie all common-interest communities, operating across present and future owners to regulate housing, impose fines, enforce rules, and control access to essential property rights. In simple terms, a servitude is a legal obligation or right attached to land itself. It is not merely a personal promise between two people. The initial rules are typically created by a single developer or declarant for a project that is being designed, marketed, and sold for profit. The future owners do not draft the rules. They do not negotiate the allocation of power. They do not decide which obligations should run with the land. That is why HOA covenants, restrictions, assessment obligations, architectural controls, use limits, and enforcement rights can bind not only the original buyer, but later owners who acquire the property years or decades afterward.

That feature makes servitudes powerful. They allow private rules to run with the land across generations of ownership. This does not make every provision of a declaration (CC&Rs) improper. But it does highlight why protective guardrails matter. Given the legal effect the law should not treat the document as an ordinary private agreement. It should require safeguards appropriate to the governance power being created.

As the American Law Institute [1] observes, “Three strands of law come together in the law governing residential common-interest communities: the law of servitudes; the law governing the forms of ownership used in the community; and the law governing the vehicle used in the community for amendment of the community-held property or provisions of service.” Restatement (Third) of Property: Servitudes at 69. But do these strands truly “come together,” as the Restatement suggests—or do they collide, unblended, revealing the absence of a coherent legal place for entities that exercise ongoing governance power?

Creating a coherent legal place for entities that exercise governance power is a legislative task. When lawmakers do not do so, courts and regulators are forced to stretch contract, corporate, and servitude doctrines beyond their intended limits, producing instability rather than accountability.

The Legitimacy Question

HOAs were originally justified as a private solution to a public problem: a mechanism for managing shared property and common amenities in planned communities without expanding municipal responsibility. That justification still appears in statutes, governing documents, and judicial language.

But over time, associations have evolved far beyond caretakers of shared landscaping and pools. Modern HOAs oversee multimillion-dollar budgets, run for-profit operations, retain permanent professional management, employ legal counsel as a routine governance actor, and exercise ongoing regulatory authority over homes and daily conduct. These are not incidental features. They are the defining characteristics of governance.

Yet the law has never squarely confronted this transformation. Instead, HOA authority has been assembled through a patchwork of legal categories that were each designed to address some aspect of common-interest communities, but not necessarily to operate as a unified system of governance.

Courts alternately treat associations as matters of contract, nonprofit corporate law, or the law of servitudes, depending on the issue presented. Whether these doctrines can—or should—apply simultaneously to entities exercising ongoing governance power is rarely examined. When none fully fits, the label “quasi-governmental” is invoked, not to resolve the mismatch, but to paper over the absence of a coherent legal fit.

Regulators focus on narrow compliance failures while disclaiming responsibility for substantive governance outcomes. The result is a system that functions, but uneasily—and often inequitably.

This unresolved status matters because legal systems are not neutral abstractions. The standards used to evaluate conduct, the remedies available for abuse, and the institutions empowered to intervene all depend on how an entity is understood in law. When HOAs are treated as private contracts, owners are told to protect themselves through litigation they cannot afford. When they are treated as corporations, deference doctrines limit review of decisions that affect homes rather than investments. When they are treated as something “like” local government, constitutional norms are invoked rhetorically but rarely enforced.

The question, then, is not whether HOAs are good or bad, necessary or unnecessary. It is whether the law has a coherent place for private entities that exercise governance power without the democratic rights normally demanded of those who are governed.

If HOAs truly occupy a space between contract and governance, then the persistent tension owners experience is not accidental—it is structural. And if that is the case, reforms that focus only on compliance, enforcement, or education will never fully address the problem. They treat the symptoms while leaving the underlying legitimacy gap untouched.

NVHOAReform's Site

This is the purpose of the articles and policy papers collected on NVHOAReform-facilitate a conversation about the unfinished legal architecture of HOAs. What really are they?

Nevada law continues to authorize HOAs to exercise compulsory governance power while often treating them as private contracts, ordinary nonprofit corporations, or routine property arrangements. The resulting tension appears in disputes over declarant control, owner records, meetings, elections, assessments, reserves, amenities, enforcement, fines, fiduciary duties, dispute resolution, and regulatory oversight.

To be clear, the point is not that every HOA is abusive or that common-interest communities serve no legitimate purpose. Owners value maintained common areas, shared amenities, architectural standards, and neighborhood stability. The question is whether the law has supplied the safeguards, limits, and accountability that should accompany private entities exercising governance power over homes.

The materials on this site are offered as a starting point for that discussion. They ask Nevada lawmakers, regulators, courts, and homeowners to confront the question that HOA law too often avoids:

If HOAs are not merely contracts, not ordinary corporations, and not governments, then what are they — and what legal rules should follow from that answer?

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[1] The American Law Institute (ALI), a body of respected judges, professors, and practitioners founded in 1923. They are one of the most respected and well-used sources of secondary authority, covering nearly every area of common law. Their purpose is to bring coherence to areas of law that have developed unevenly across states by distilling prevailing legal principles into authoritative formulations.