How HOA Leasing Requests Can Block Homeowners From Renting Out Their Own Property

Leasing out your property can be a great way to earn some extra cash, especially in today’s day and age with inflation through the roof.

However, if you live in a condo, townhome, or other property with a homeowners association, leasing out isn’t as simple as finding a tenant. 

As you might expect, you’ll need to submit an official request to your HOA for permission—and there’s no guarantee it will be approved.

However, by familiarizing yourself with the process and knowing the common reasons for denials, you can increase your chances of success.

How leasing requests work

If your property is part of an HOA, a leasing request is the first step toward renting it out. But there's plenty of paperwork to follow.

“Most associations require a lease application, a copy of the lease, tenant background checks, and any applicable fees to process a request,” says Raul Gastesi, real estate attorney and managing partner at Gastesi Lopez Mestre & Cobiella in Miami. 

The HOA will review the request to ensure it's in accordance with the community's leasing rules. According to Jonathan White, managing partner at Jordan & White LLC in Boston, many HOAs cap the number of units that can be rented out to preserve owner-occupancy ratios for mortgage eligibility. 

“Others restrict short-term or seasonal rentals, or take 30 to 60 days to review requests, leaving owners stuck between tenants. Even worse, owners who bought when leasing was allowed can later find themselves bound by new restrictions,” says White.

Note that leasing requests are not intended to dissuade homeowners from leasing out their properties.

“This process is designed to protect the property and the community. It ensures the same standards are applied to both owners and tenants," explains Gastesi.

HOAs can stop homeowners from renting out their property

In a perfect world, you’d submit a leasing request and get the green light right away. The reality, however, is that denials are fairly common.

“Property owners often believe their HOA will be flexible with leasing rules and make exceptions. In many cases, this is simply not true,” says Gastesi.

Some of the most common reasons for denials include incomplete applications, lease terms that are too short, exceeding the community’s cap on leases, and attempting short-term or vacation-style leases when they’re not allowed. 

“Outstanding assessments, pending violations, and failed background checks can also disqualify you from leasing out your HOA property,” adds Gastesi. 

What to do when your HOA says no

In the event your HOA rejects your leasing request, understand you do have options.

Gastesi recommends you go back to the board and ask for a written explanation for the denial.

“Denials based on an incorrect assumption can sometimes be remedied by additional documentation or explanation,” explains Gastesi.

If you live in a state such as Florida or Massachusetts, you might also be able to challenge a denial through mediation or arbitration before filing a lawsuit.

“Pre-suit mediation and arbitration allow both parties to present their side of the issue for review based on the governing documents without the expense of litigation,” says Gastesi.

Remember that an HOA is not allowed to overstep its authority or apply rules and regulations arbitrarily. As a homeowner, you have the right to challenge any decision made outside of its authority. 

“My biggest piece of advice is to keep your challenge factual and procedural. Emotion usually inflames issues that otherwise can be worked out through proper channels,” explains Gastesi.