Stephanie Guzman, Reporter for Albuquerque Business First:

Two years ago, the state put in place a law that requires homeowner associations (HOAs) to disclose membership costs and other financials to potential buyers.

The requirement of a disclosure certificate was seen as a good thing, as a way for HOAs and management companies to be more transparent. But the price of compiling a disclosure certificate varies from community to community.

The Greater Albuquerque Association of Realtors say the fees can range from $0 to $1,000 plus, though a management company said the typical fee is between $200 and $400. Those fees impact many homebuyers and sellers, as GAAR says about 40 percent of its listings belonged to an HOA.

In an effort to address management companies that charge high fees, Rep. Monica Youngblood, R-Albuquerque, introduced legislation that would cap the disclosure certificate fee at $150.

The Realtors Association of New Mexico worked with Youngblood on the legislation. M. Steven Anaya, CEO of RANM, said he doesn't understand why some HOAs charge exorbitant amounts for the documents, when most of the information should be on hand and the only cost would be related to employee time and making copies.

"Some [HOAs] see this as a cash cow and it's become a good profit center for them," Anaya said. "We think it's gouging the sellers of the property a little bit too much."

The Dallas-based community management company Associa, which has offices in Santa Fe and Albuquerque under the name Associa Canyon Gate, opposes the proposed legislation. The company manages more than 50 communities in New Mexico and said if passed, the law would prevent HOAs from recovering the costs of preparing disclosure packets, and said HOAs may have to raise dues on all members.

John Krueger, Associa’s vice president of government affairs, said HOA monthly fees are pretty low due to competition in the market. He said most management companies decide to charge separate transactional fees when someone sells a home.

"The people benefiting from that transaction is the seller and buyer. That’s why it’s assigned there rather than spread those costs among all of the members of each association," Krueger said.

_______

NOTE: Both GAAR and RANM support this bill. Click here to learn why.