One of every five Americans lives under rules and regulations that could confiscate their homes from them, remove their right to privacy and take away their freedom of expression.
Neither Congress, the police nor local governments can do anything about it. Some people hate the situation. Others love the rules. Many homeowners, however, don't realize what rights they've signed away until it's too late.
They are people living their American Dreams inside a community regulated by a homeowners association (HOA), and corresponding covenants, conditions and restrictions (CC&Rs) that constitute a form of government that pleases some but is just a headache-inducing hassle for others.
"Fifty-five million Americans live in developments overseen by community associations," says consumer watchdog Ken Hyland. "Four out of five of those associations are doing well, but the other 20 per cent have problems."
The reason: The rules that govern private home developments are very difficult to change and are set up by developers who never live on the site and who disappear after a few years.
Here's an overview of HOAs and CC&Rs, what they are and what they can do to you.
Signing away your rights"It is an enormously serious and growing problem," says Evan McKenzie, a professor of political science at the University of Illinois.
"If you move into a covenanted neighborhood, you have no choice but to abide by the covenants. It might be your house, but you can't do just what you want with it," explains McKenzie, a condo law expert and author of "Privatopia: Homeowner Associations and the Rise of Residential Private Government."
"While certain rules -- like the hours of swimming pool operation -- can be changed quickly by the governing board, deed restrictions are almost impossible to change, requiring a huge majority of owners.
"Some people like that. They want to know that their community won't be marred by car-repair enthusiasts or illegal residents in trailers. But others resent being told what color their house may be painted, or that they can't fly Old Glory on a flagpole.
"Not knowing what you are getting into can be costly. Your association can fine you. If you don't pay, it has the legal right to collect by selling your house!"
How it all startedMcKenzie outlines how the problem arose: "For years, there was an emergence of incentives that produced common-interest housing.
"First, people were demanding affordable housing. To meet that demand, developers wanted to build more units on less land to keep costs down. Meanwhile, municipalities wanted to increase the tax base but also wanted to avoid the huge cost of providing expensive roads and utilities."
The solution: Common Interest Developments. Instead of providing every house with its own pool, driveway and lawn, CIDs provided homes with shared amenities.
They sometimes avoided local density codes, adds McKenzie, because the communities were private developments that the local authority did not have to oversee or maintain.
"The oversight responsibilities instead fell to volunteer committees of private homeowners with help from professional property managers and lawyers, creating in each CID a private government with residents signing a binding contract to obey its laws."
The changing American landscapeLocal governments liked getting property taxes from developments that cost them nothing, so states such as Texas, California, Nevada, Florida and Virginia saw to it that little else was built.
In 1965, fewer than 500 CIDs existed nationwide. By 1970, there were 10,000. Today, although there is no official monitoring, experts estimate there are 250,000 common-interest developments.