Prior to 1910 the modern community association did not really exist. Some subdivisions did have deed restrictions and attempted to enforce them, and some private property owners' neighborhood organizations did provide basic services and own and maintain common facilities, but no compulsory membership homeowner association was constituted through deed restrictions to perform all three of the basic functions of a community association.
The Origins of HOAs
Early Formation and Rise of HOAs (1900s–1970s)
1910s–1930s: The Seeds Are Planted
The idea of planned communities with deed restrictions and architectural controls began in elite developments like Palos Verdes (CA) and Shaker Heights (OH).
These early HOAs were mostly private enclaves for the wealthy, designed to maintain a certain aesthetic and exclude certain groups of people (via race-based covenants, later banned).
1930s–1940s: FHA & Racial Segregation
The Federal Housing Administration (FHA), created during the New Deal, started subsidizing suburban development—but only if homes adhered to certain restrictions.
These covenants were declared unenforceable by the Supreme Court in Shelley v. Kraemer (1948), but their legacy lingered.
The Fair Housing Act of 1968 later made such discrimination explicitly illegal.
FHA guidelines encouraged racial homogeneity and discouraged integration, often requiring racial covenants in order to qualify for financing.
HOAs became a vehicle for enforcing these restrictions, ensuring the neighborhood met FHA’s “standards.”
Post-WWII Boom: 1950s–1970s
After WWII, the U.S. saw a massive housing and suburban explosion, driven by returning GIs and government-backed loans.
Developers built entire subdivisions at scale—like Levittown—and began using HOAs to govern the community after selling the homes.
Government Encouragement
During the 1960s–1980s, local governments encouraged HOAs as a way to reduce the public burden—developers and residents would manage infrastructure (roads, parks, etc.) themselves.
This led to a boom in private, self-governed communities—essentially mini-governments with the power to tax (through dues), regulate, and enforce rules.
Beginning in the late 1970s, two key secondary mortgage market institutions, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) have been very influential in the process of restructuring community association organization, financing, and management to conform to new implementation guidelines. The number of community associations operating in the country grew 30-fold from 1970 to 2013 to include over 26.3 million housing units and 65.7 million residents. These figures represented approximately 24 percent of the U.S. housing stock. [1]
Finally, in the past decade developers have been relinquishing more control of community associations to the property owners at earlier stages, as part of a phased process. But not all are following. Read more here.
Why HOAs Are So Controversial
Power & Control
HOAs have government-like powers without the same checks and balances. more calls for democratic governance and limits on unchecked board power.
Boards are often made up of volunteers with little training, yet they can make binding decisions and control significant funds.
They become a de facto investor in our home investment.
Conflicts often arise around aesthetic regulations, political signage, solar panels, short-term rentals, and other lifestyle choices, reflecting broader cultural and political divides.
Technology and outsourcing management to professional companies, a dominant feature to streamline operations, leads to reduced homeowner involvement.
Inconsistent Governance
Rules and enforcement vary wildly, leading to claims of bias, favoritism, or abuse.
Some are well-run, while others are chaotic, overly strict, or even hostile.
Property Rights
Critics argue that HOAs infringe on personal freedoms—telling you what color your house can be, what flag you can fly, or how tall your grass can grow.
Supporters say they protect property values by maintaining neighborhood
standards.
Legal Disputes
HOAs are involved in a lot of lawsuits—either against homeowners or by homeowners.
Controversy and litigation are rain makers of attorneys.
Foreclosures over minor infractions or missed dues can feel extreme and unjust.
Financial Transparency
Some HOAs are criticized for poor financial management and lack of transparency about how assessments are spent.
Corruption and embezzlement, while not common, have happened.
Mixed Public Opinion
Disagreements on the “value added” proposition- both objective and subjective value.
Some people love HOAs for the security, aesthetics, and amenities they offer.
Others see them as overreaching, petty, and authoritarian.
In some states (like Southern Nevada, Florida, Texas, and Arizona), HOAs are almost unavoidable.
Model Legislation: How HOA Law Evolved
From Condominiums to Common-Interest Communities
By the 1970s, the growth of planned developments and master associations demanded a broader approach. The Uniform Law Commission (ULC) responded by drafting the Uniform Condominium Act (1976) and, later, the Uniform Common-Interest Ownership Acts (UCIOA) in 1982, 1994, 2008, & 2014.
UCIOA represented an ambitious effort to unify the patchwork of laws governing condominiums, cooperatives, and planned communities under a single model. It sought to balance the interests of developers, associations, and homeowners, while recognizing the quasi-governmental functions these entities had begun to assume. Amendments have refined its provisions but do not fully resolve tensions between association boards and individual owners.
The Persistent Tensions and the 2008 “Bill of Rights”
Despite decades of legislative drafting, problems persisted. Even in states like Nevada, which adopted UCIOA substantially intact in 1991, homeowners increasingly reported unfair treatment by boards and management companies. Legislatures responded piecemeal, passing targeted “fix-it” bills to address isolated issues—flag-display rights, satellite dishes, election procedures—while avoiding deeper structural reform.
Recognizing these ongoing disputes, the ULC in 2008 introduced the Uniform Common Interest Owners Bill of Rights Act (UCIOBRA). This narrower model was designed for states unwilling to adopt the full UCIOA. While it included key governance and transparency safeguards, it omitted major components such as creation, alteration, and termination procedures, developer control limits, and the model administrative enforcement system originally envisioned by UCIOA.
Why the Models Still Fall Short
By the early 2000s, the ULC itself acknowledged that “major tensions remained in the Common-Interest Community field that neither UCIOA nor most state statutes adequately addressed.” Those tensions centered on a perception—shared by homeowners, regulators, and academics alike—that individual owners were structurally disadvantaged in their dealings with association boards and the attorneys and managers employed to represent them.
The result today is a patchwork of partial adoptions, political compromises, and special-interest amendments. The original goal of a unified framework balancing property rights and self-governance has given way to a fragmented system in which each state’s HOA law reflects local politics more than consistent legal principle.
________________________
[1] Treese, C.J. (2014). National and state statistical review for 2013. Retrieved from
http://www.caionline.org/about/press/Documents/State%20and%20National%20Statistics
