With plenty of talk and news stories all about Wall Street investors gobbling-up single family homes as rentals and home buyers, particularly those searching for their first home, shut out of the market, Fishers Mayor Scott Fadness conducted an online video town hall centered on that issue Thursday night.
The bottom line of the discussion is that the action on handling this issue is squarely in the hands of local Homeowners Associations (HOAs).
Attorney Kim Sutter says HOAs generally have the authority to enact rental restrictions or bans. Bans are more difficult to enforce and restricting the number of rentals in a given neighborhood can be an administrative burden, but Sutter says that can be done with the proper legal advice. Other possible restrictions HOAs could enact include capping the number of rental homes as a percentage of the total homes in the neighborhood. Some HOAs have combined restrictions, such as capping the number of rentals and requiring a waiting period, meaning the buyer would be barred from renting the property for a specified period of time after acquiring the home.
Fishers city officials say out-of-state homeowners have double the number of city code violations compared to homes owned by the residents.
Mayor Fadness says the city is working on possible city-wide solutions, but the legal hurdles to accomplishing this now are very complex. According to the mayor, no municipality has figured out a city solution to this problem that has passed legal muster.
One major concern of the mayor is that families often accumulate wealth through home ownership and when families are locked-out of the home-buying market by investors offering cash payments and no inspections, that impacts those families long-term financially.
Attorney Sutter offered suggestions on how HOAs can enforce their covenants and change language to address this issue.
Mayor Fadness ended the town hall saying he wants a city solution and attorneys are brainstorming possible solutions, but at this juncture, the HOAs are the center of the current solution.
Fishers Economic Development Specialist Jordin Alexander and the Director of the Fishers Planning and Zoning Department, Megan Vukusich, also participated in the online video event.