Question: In a recent column you said that, if the required majority of homeowners, e.g., 51% of the homeowners, vote to amend the Covenants, Conditions, and Restrictions (“CC&Rs”) to prohibit short-term rentals, then such restrictions would be enforceable against all homeowners. I understand that when a buyer purchases a home, that buyer must comply with the existing CC&Rs. Any amendment to the CC&Rs, however, should only apply to a buyer who purchases a home after the amendment to the CC&Rs. Existing homeowners should be “grandfathered,” and not required to comply with any amended CC&Rs. To carry your argument to the extreme, if 51% of the homeowners vote to amend the CC&Rs to require that all homes be painted “hot pink,” then an existing homeowner who purchased a home before the amendment to the CC&Rs would now be required to paint their home “hot pink.” Is that correct?
Answer: Yes. First, CC&Rs are private regulation of all homeowners who purchase homes in the community. Even if the homeowner, at the time of purchasing the home, has no actual knowledge of all of the provisions in the CC&Rs, the recording of the CC&Rs is constructive knowledge to the homeowner of all of the provisions in the CC&Rs, including the provision to amend the CC&Rs. Therefore, if the CC&Rs are properly amended to require all homeowners to paint their homes “hot pink,” that amendment is enforceable against all homeowners, including existing homeowners.
Note: Many communities in the Valley have CC&Rs that require the homes in the community to be properly maintained, including re-painting to a specific color, in order to protect property values in the community. The HOA usually gives the homeowners a lengthy period of time to complete the re-painting, and the HOA might even financially assist any homeowner who is short of funds to do the re-painting.
Amendments to the CC&Rs of condominium communities are different than amendments to CC&Rs of planned communities of single-family homes. Any amendment in the CC&Rs of a condominium community restricting the uses of a condominium requires approval of all condominium owners. A.R.S. §33-1227(D).