Costly Condo Leasing Restrictions

R.F. from Texas writes:

Dear Mister Condo,

Years ago (before I bought my condo in Texas) the HOA passed a Standard Operating Procedure (SOP) and made it mandatory that all rentals go through their onsite management. If I rent my unit out on my own I must pay the full 40% fees + a penalty. Is this even legal for them to force me to use them?

Mister Condo replies:

R.F., leasing restrictions such as the one you have described are not uncommon. Using a particular agent for leasing agreements is one way the Board of the HOA can be certain that all leasing rules and regulations are adhered to. The penalty for not leasing through their agent is designed to discourage the practice and, at a 40% fee plus penalties, I imagine it is particularly effective. While it does seem unfair that you don’t have any other reasonable option for renting your unit other than by using the onsite management company, my guess is that the onsite management company is an excellent and efficient way to keep your unit rented out. Since anyone interested in renting will ultimately end up at their doorstep, there is a greater likelihood that they will rent it out quicker and to a qualified renter. All the best!

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