Prohibiting fees for the placement of for sale or rent signs

An owner’s right to sell real estate is a property right, and exercising that right requires marketing and signs. In the past, homeowners associations (HOAs) have tried to limit owners from marketing their property with signs on their lawn or even in their own window.

In 2007, the law governing HOAs was changed so that they may not prohibit the indoor or outdoor display of a for sale sign by a condominium unit owner or single family homeowner on their own property. In 2010 the Arizona Association of REALTORS® fought for and successfully modified statute to prevent an HOA from prohibiting or regulating temporary open house signs, a unit owner’s or owner’s agent’s for sale or lease sign and open house hours for property that is available for sale or lease.

It was recently brought to AAR's attention that some HOAs are attempting an illegal requirement that in order to use signs in certain condominium and planned communities by unscrupulously charging a fee for the use or placement of the indoor or outdoor signs. Some examples of such practice include HOAs that prohibit the use of sign installation from any other company than their “preferred vendor” which can cost upwards of $75 for the installation.

As a result of the continued efforts by HOAs to skirt current law as well as their continued creativity in finding ways to charge fees to homeowners as it pertains to for rent and sale signs, AAR has asked two Representatives to run language that would strengthen current law and penalize those associations that violate the law. HB 2609 (homeowners' associations; signs; political; leasing) sponsored by Representative Barton passed out of the House last week with a vote of 36 ayes, 21 nays and 3 no votes. The bill has been transmitted to the Senate and assigned to the Senate Government Reform Committee. The other is HB 2717 (homeowners' associations; penalties; attorney fees) sponsored by Representative Carter. This bill was amended on the House floor on last Thursday to add language pertaining to this issue.

The language in both bills would do the following:

·Prohibit an HOA from charging a fee for the use or placement of the indoor or outdoor display of for rent, sale or lease signs and sign riders, in any combination, displayed by a property owner on their property.

·States that an HOA or managing agent that violates specific statutes governing the use of indoor or outdoor signs by a property owner on their property forfeits and extinguishes the lien rights authorized by statue against that unit or property for a period of six consecutive months from the date of the violation.