Is your home at risk for takeover? State law allows for condos to be forcibly taken
ABC 15 Arizona
Joe Ducey, Courtney Holmes
01 March 2016
It's happening again. People who paid their mortgages and are not in foreclosure, being forced out of their homes.
We first told you about this weird law, when a man bought a condo near
35th Avenue and Camelback only to find out Grand Canyon University
terminated the HOA and took over the units.
This time it's people who bought within Jamestown Condominiums in Phoenix, in 2008.
They made an investment at a time when the economy was failing, but the
neighborhood near 30th Street and Indian School, was on the upswing.
Sign on her unit door
"It was getting better because you have Arcadia and you have The Biltmore," says owner Carolyn.
She was one of the first to buy and took pride in finally owning a home. Updating her space and giving it personal touches.
"It was just like a blank canvass," she says with a smile. "I was able to decorate it and put tiling in."
Another owner Jeff says it just made sense.
"It was an opportunity that most dream about, and it was right place
right time. So I did it along with 140 other people," Jeff says.
But by 2015 an investment group purchased several of the units within the community.
Jeff says, he should have known something was up.
"Because you've got owners and rentals. And then a new owner came in
and bought the property. This is when it started to spiral downhill but
we didn't know it," Jeff says.
They say eventually they were given a notice that they had to go.
gave us 5 days to leave
"There was 30 of us left and that point," Jeff says. "Then they
acquired the 80 percent. They got a termination agreement, said
it was filed and then gave us 5 days to leave."
Carolyn couldn't believe it.
"We were flabbergasted that this could happen," she says.
The Arizona Condominium Act (ARS33-1228) allows for an HOA to disband
if 80 percent of the members agree to it. In this case the investors
were the 80 percent. Forcing the remaining owners to sell at what they
called market value set at $75,000. That number was determined by
an appraiser, hired by the investor-run HOA according to the
termination agreement filed with the county.
just enough to pay off their mortgages
These folks say it was just enough to pay off their mortgages and left nothing to even put toward a down payment.
Owner Dexter is one of the last holdouts, and says he's got nowhere else to go.
"I guess I could go next to QT or that week to week place. But you like your homeless," he says.
Carolyn has moved out, but says this isn't the end and hopes to keep it from happening to anyone else.
why would you ever buy a condo? It's the highest risk I've ever seen
"This law needs to change otherwise why would you ever buy a condo? It's the highest risk I've ever seen," she says.
There are still a few holdouts but most of the condos are now being rented out as apartments.
We'll be following up to see where lawmakers stand.