Tuesday, May 25, 2010


This is a very bad idea.


  1. I know several of our area HOAs that use transfer fees. 2 very new communities under the same Houston development co. in Missouri City also use them and they set it at .5% for sales on existing homes and half that for new builders.

    I agree, anytime you give these developer/builders more power to tax us you are making a huge mistake. They never should have given them the power of running liens on our property either after we have purchased. Not should they be given the power to set-up our covenants and deed restrictions, at least not after build-out. They should have to take those with them when they leave.

    A few years ago they tried to pass TUPCA here in TX that would have given them the ability to run our HOA boards for up to 30 years after build out. We can thank legislatures like John Carona and Charlie Howard for efforts like this. Thank god it was defeated that year.

  2. Thanks for sharing that article!

  3. Yes it does stink.

  4. It is a bad idea. In 2007, legislation was proposed by TLTA in a first House bill to make any transfer fees void. This bill didn't make it.

    You might find it interesting that a second House bill being considered by Senate committee was amended to create an enabling act to permit political subdivisions of the state, HOAs, developers, and HOA management companies to charge a transfer fee. (see Texas Prop Code 5.017). Participants in that Senate Committee included Sen John Carona, owner of the largest legion of HOA management companies and affiliated businesses in the U.S. Imagine his creation of an enabling act to allow management companies (which have zero ownership in the property) to charge owners a transfer fee when the owner sells his property. Fort Bend county is no stranger to transfer fees either since Sienna Plantation, Riverwalk and others impose such fees on homeowner owned property. You see the other hook in the transfer fees statute lets developers impose a transfer fee if the developer makes it payable to a "foundation". So all the developer has to do is set up a foundation that it controls in order to divert sales proceeds from the homeowner to the developer-controlled foundation. These are all equity-stealing provisions benefiting HOA vendors, not the homeowners.

    Note Sen Carona's involvement by looking at the history of HB 2207 from the 80th: