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Charlotte homeowners associations create rental caps to limit corporate investors

Homeowners associations across Charlotte are fighting to keep their neighborhoods free of corporate investors.
Published: May. 10, 2022 at 6:54 PM EDT
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CHARLOTTE, N.C. (WBTV) - Homeowners associations across Charlotte are fighting to keep their neighborhoods free of corporate investors.

It’s a growing issue in some neighborhoods where corporations are buying homes sight unseen and then renting them out.

Some renters say the corporate landlords are not around to help with maintenance requests. It’s also impacting the ability for first time homeowners to buy a home.

Home Owners Association president Gordon Mullings says he and his neighbors in the Reunion/Enclave subdivision of Steele Creek decided to take action last summer.

They put a 10 percent cap on rental properties.

It’s a growing issue in some neighborhoods where corporations are buying homes sight unseen and then renting them out.

“What we were starting to see was a commonality in regard to the ones that were on our violations,” Mullings said. “What is the common theme in regards to when we’re having violations, and it happened to be rentals.”

Mullings says he was knocking on doors, holding meetings and answering peoples’ questions in order to get 66% of the neighborhood to vote yes.

“It wasn’t against rentals,” he said. “But when you have a homeowner, you have skin in the game, versus a lot of these are remote LLCs as well. They’re not gonna have that level of diligence in regards to maintaining a property like a homeowner or even a small business owner that has a couple of properties.”

According to city of Charlotte data, there are several hundred HOAs and neighborhood organizations scattered across zip codes, but there are also areas without an HOA.

“Those are going to be neighborhoods that don’t have an association, probably don’t have restrictions, and there’s not going to be any limitations to stop an entity from coming in and buying a large block of homes,” attorney James Galvin, who does HOA litigation, told WBTV.

Galvin says if your neighborhood does not have an HOA, you can still check for deed restrictions.

“Sometimes where the developer doesn’t create an association, but there are certain standards that must be kept,” he said. “You can in those neighborhoods still introduce an amendment to your restrictions to prevent leasing short term rentals.”

Mullings believes the steps they took will provide long term benefit.

“They will always win, so how can you protect, or at least have them have to pause when it comes to your community,” he said.

Mullings says they also put a ban on short term rentals in the neighborhood, restricting people from turning their homes into AirBnBs.

He says he did face some opposition, but ultimately 66% of the homeowners chose to move forward with it.

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