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PUD vs. HOA

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Michael A. Imes

Thread Starter
Freshman Member
Joined
Apr 12, 2002
Can someone please explain to me the difference between a PUD and an HOA? I have had differing opinions from different people, lenders, title cos., etc.
 

rtubbs

Junior Member
Joined
Jan 15, 2002
Michael, the two are not comparable but what you need to keep in mind is s: if there is an HOA, the UW will consider the development to be a PUD and you will need to address that in the appraisal, usually just in the PUD section. Some underwrites will require the PUD addendum. If you haven't already, read the Fannie Mae Selling Guide on that section.

Good luck,
 

Paul Ness MAI

Member
Joined
Jan 14, 2002
Professional Status
Certified General Appraiser
State
Pennsylvania
I don’t know the “official” definitions for these terms, but here is my practical attempt at defining them.

A PUD is the term given for a development that was designed and approved in a unified manner as a single project possibly with interrelated sections (sometimes separated by phases or building types) that complies with all the municipal regulations (zoning, subdivision and possibly even PUD ordinances) and environmental requirements on such development. There can be SFR's, condos, townhouses, commercial uses, etc. in the PUD. Incorporated in the plans is the location of common utility services, open areas, recreational amenities, retention basins, etc. Sometimes these areas are publicly dedicated and sometimes they remain under the ownership of the HOA.

An HOA is typically a private non-profit organization consisting of the property owners of a given neighborhood. The HOA is usually responsible for maintenance of common areas and they charge dues to the home owners as a source of revenue. There are governing by-laws as well as regulations that create covenants and restrictions that the property owners must abide by. The HOA is usually run democratically with officers elected by the home owners as spelled out in the by-laws. Each unit owner is entitled to vote in the governing process. While under construction, the developer is often in control of the HOA, owning the bulk of the units. When the development is sold out, control goes entirely to the home owners.

The two are totally different things. When there is a PUD there is usually an HOA. However, if there are no common elements remaining (they have been deeded away) and no further need for an HOA, the HOA can be dissolved, as almost happened in my former neighborhood. Further, an HOA can exist in any neighborhood where the homeowner's desire to have one.
 

Mary Caffey

Sophomore Member
Joined
Feb 22, 2002
In our small community we have numerous subdivisions with each having a private boatlaunch facility and park for property owners. Each has an HOA an collects dues for the mtce of said areas. Some even have tennis courts and rec halls all taken care of by the HOA dues. That constitutes a PUD in the eyes of the UW in my area.


Mary (in East Texas):wink:
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
I agree with Paul's response. In my area, we have lots of homeowners associations, but they have no true power over the owners and are not a PUD. Any neighborhood can have a "homeowners association", they meet in the back yard and talk about getting together to pick up trash, talk politics, etc. But the PUD is mandatory membership, and the "association" will come knocking for their dues.

As my attorney told me, it is a PUD when the association has the right to files a judgement or foreclose on your property due to non-payment of dues or compliance of ordinances. If it is not a true PUD, the owners association has no power.
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
The key word is "mandatory". If the HOA fee is mandatory and everyone that owns property within that specific subdivision/phase/community has to be long and pay to the association, it is a PUD. If the HOA fee is voluantary, the homeowners have a choice of belonging or not belonging to the association, then it is not a PUD.
 

jtrotta

Senior Member
Joined
Jan 16, 2002
In our area it differs from municipality, depending on zoning regulations and how the project is drafted in it's originality.

If there is a "prospectus" wether it's a "PUD" or Condo. as the terms go, the prospectus will dictate in what manner the property lies (lays) - is held.
There is no term (mandatory) involved in the prospectus here; there is a definite course of action (positive or negative) in which the community as a whole must abide.

Because zoning is not carved in stone, we have municipality's that do not define those specific "Terms" and therefore, a developer may be required to submit there rendition of "Terms" via their attorney and await approval. A "PUD" (Planned Unit Development) can be of a variety of "Terms" based in part on what the builder/developer presented and also how the attorney set up the development. Therefore, all are not the same and we need to review most documents to see how they are held.

Good Luck

8)
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
8O
Sheesh Trotta, what they trying to do? Make you a title Xpert?
 

jtrotta

Senior Member
Joined
Jan 16, 2002
Ahhhhhhhhhh and you thought I had an easy job :lol: :lol:

yep, they let some critteers outa the pen a long time ago and loook what we gots now - an their all experts -you should read some of the stuff thats in there - oh yeh, "A Co-Op 8O we have about three in the whole state :roll: get one of those puppies and it becomes a barrell o fun :arrow: :idea: :?: :!:

8)
 
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