I was talking with a friend and his nightmare scenario is that a PE or other investment firm swoops in a begins buying homes in neighborhoods and subdivisions with HOA for the purpose of usurping resident control over the boards. I found it to be kind of unlikely in established neighborhoods given that probably a supermajority of the homes would need to be purchased by single investor or a cartel of investors to gain voting control over the HOA.

The story in the article is that one such firm (Invitation Homes) bought homes directly from the developer in a newly built neighborhood.

Some choice quotes:

The corporation gained a controlling share of the 126-home community. When it came time to vote for the three-person board for the homeowners association, Invitation installed two employees on the board. Both live in Texas.

The Times found that firms with ties to Wall Street and private equity own more than 10% of Florida’s single-family rentals, a rate five times higher than the national average, according to industry group estimates.

Academic researchers say it’s easier for corporate investors to keep expanding in Florida because of regulations that limit or prohibit local controls and renter protections.

The exact scenario my friend was worried about (emphasis mine):

As the election approached for the homeowners association board, two of Invitation’s employees submitted applications, listing the company’s Dallas headquarters in the address field. Neither employee is listed on property records as a homeowner in the neighborhood. With 100 or so homes in the community, the company controls 80% of the vote. Resident homeowners wouldn’t make much of a difference.

“They could change the bylaws,” she said. “They could potentially dissolve the HOA if they wanted to.”

The most “we’re evil and we know it” PR response which feels like a corporate hivemind / AI demon:

“Our goal is to be part of a community, not in control of it,” she said.