Establishing HOA rules for home businesses helps control neighborhood appearance and traffic, but boards must first determine whether they have the authority to enforce them. State laws and the association’s governing documents play an important role, and compliance is necessary to avoid legal liability.
Can HOA Ban Home Businesses?
Homeowners generally have the freedom to alter their homes and use their properties as they wish. But in HOA communities, there are restrictions that owners must consider. Many associations have rules that dictate what owners can and can’t do, even in their own homes.
Whether an association can ban an HOA home-based business depends on two factors: state laws and the governing documents. In Virginia, Section 55.1-1821 of the Property Owners’ Association Act states that HOAs can’t prohibit the operation of a home-based business in a personal residence unless the CC&Rs specifically prohibit it.
If an HOA’s CC&Rs do not explicitly ban home businesses, then the board has no authority to enforce such a rule. The board would need to amend its CC&Rs to specifically address home businesses and prohibit them.
This is why it is crucial for both board members and homeowners to check their governing documents. These documents, particularly the CC&Rs, establish the association’s authority, define obligations, and outline restrictions.
Owners must adhere to these documents or else face potential penalties. Similarly, board members must enforce these documents fairly and consistently or risk facing legal liability.
Child Care Businesses in Virginia HOAs
Section 55.1-1821 also discusses child care businesses. If a county or city’s zoning law allows home-based child care as part of normal residential use, then running a small child care service from a home is considered a residential activity, not a business.
Because of this, homeowners in an HOA may operate home-based child care. The exception to this is if the association’s governing documents prohibit or restrict it.
Permitted HOA Rules for Home Businesses
While an HOA can’t outright prohibit home businesses unless the CC&Rs allow it, it can impose reasonable rules on them. Of course, these rules must also be reflected in the governing documents. Here are the permitted HOA restrictions on home business.
Operational Details
According to Section 55.1-1821, an association may restrict the time, place, and manner of the business’s operations. For example, the HOA may limit the hours during which the business can open, especially if it involves customer visits or activities that others may find disturbing.
An association might also require owners to conduct business inside the home. This means no business can be conducted in garages, yards, or other areas visible from the outside.
Signage
Businesses come with signs — that’s just the reality of it. Signs allow customers to spot the business from afar, avoiding getting lost on the way. But signs also bring disadvantages, particularly to the association.
To address these disadvantages, an HOA may regulate business-related signs. This includes rules about the size, location, duration, and manner of placement.
Local Ordinances
Finally, an association may require owners to follow local zoning and licensing rules. Even if the HOA allows the business, it still has to comply with city or county regulations.
Why HOAs Dislike Home Businesses
Many associations restrict home businesses to preserve the character and appearance of the community. These restrictions also help reduce disruptions that could bother neighbors. While most home-based businesses don’t pose problems, others can be obstrusive and affect the neighborhood as a whole.
Here are the reasons why boards discourage the establishment of a home business in an HOA home.
Traffic and Parking
First, HOA home business restrictions help control traffic and parking, which are two of the main concerns. Some businesses bring frequent visitors, delivery vehicles, and employee parking into the residential community. This can create congestion and reduce available parking for residents.
Moreover, increased foot traffic can frustrate neighbors. More visitors mean more trash, too. And they aren’t necessarily as concerned about keeping the neighborhood clean and free of damage.
Noise Levels
Another common reason is noise and activity levels. Certain home businesses may generate a lot of noise, especially compared to others. For instance, an online business is less likely to be loud than, say, a retail store. Plus, there’s noise from equipment and talking customers.
Even small increases in activity can disrupt an entire neighborhood. Residents value their peace and quiet, and businesses can put a wrench in that. This is why boards adopt HOA rules for home businesses.
Safety and Security
Associations also worry about the risks to safety and security. Businesses might attract clients or customers, drawing them to the home. When this happens, residents will spot more unfamiliar faces entering the neighborhood, causing anxiety and fear.
Gated or private communities are especially affected. In these communities, residents expect more control over security. They value exclusivity and privacy, and home businesses interfere with that.
Commercial Appearance
Commercial appearance is another issue. Some businesses change the property’s look, making it stand out like a sore thumb. These can disrupt the neighborhood’s uniform aesthetic and lower curb appeal.
There’s also the problem of signage. Signs, especially gaudy ones, can make an entire street look tacky and dated. For this reason, the law allows HOA rules on home-business signage.
Liability Concerns
Allowing home businesses comes with liability concerns, too. If a customer or delivery driver is injured while visiting a home business, the association might face potential legal risks. This is particularly true if the incident occurs in a common area, such as a sidewalk or parking lot. To counteract this, boards must encourage home business owners to carry proper insurance coverage.
Property Values
Homeowners associations aim to preserve property values. In fact, many buyers choose HOA communities because they expect quiet residential living, enhanced curb appeal, and investment protection.
When businesses start to pop up all over the neighborhood, some owners may worry that the neighborhood will feel more commercial than residential. Add in the traffic, parking, noise, and security concerns, and the market value may plummet.
A Balancing Act
When establishing HOA rules for home businesses, the board must balance homeowner wants with the association’s best interests. Home businesses may support remote work and extra income, but they can damage the association’s reputation and property values. Rules help, but enforcement must stay within the board’s authority.
National Realty Partners is a leading provider of HOA management services in Virginia. We can help your board manage and enforce the rules. Call us today at 703-435-3800 or request a proposal online!
RELATED ARTICLES:
- A Guide On HOA Violations And Fines In Virginia Communities
- HOA Garden Rules: What’s The Big Deal With Plants Anyway?
- How Strict Can HOA Holiday Decor Rules Get?