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3. The Sellers: You don't Ask and We Won't Tell

One of the most sinister aspects of the CID industry is the issue of disclosure. Are buyers given enough time and information about CID living to make a well-informed decision? The answer of course is no.

this property is condemned
If the public were truly well informed, then the product wouldn’t sell. As with all other dangerous products, CID housing should come with a consumer warning. Maybe something like:

Living in a CID can be hazardous to your health. Common side effects include:

Loss of privacy

Loss of the pleasures of home ownership

Loss of income

Loss of piece of mind

Loss of sleep

Loss of home

Loss of life

You may think I’m kidding about that last entry, but it has already happened.

If you read chapter two on the CC&Rs, then you are probably beginning to realize that life in a CID presents some very serious problems for the homeowner, and it is just this knowledge the developers sale agents and independent real estate agents are desperate to keep from you. If you don’t ask about the deed restrictions, you will not know about them until it’s almost too late.

pay no attention to those covenants behind the curtain!
The real estate industry is no stranger to ballyhoo; you’ve all seen the flags and banners and hot air balloons and all the other eye catching devices they use to draw you near, but you will never hear them tout the presence of CC&Rs or homeowners associations (HOA). The deed restrictions will not be hung in a gilded frame on the sales office wall for all to see. There will be no brochures showing happy homeowners posing in front of their new homes ecstatically waving their deed restrictions. This is something the real estate industry does not want to talk about.

As you will see, the CID industry is shrouded in secrecy. The efforts on the part of real estate agents to conceal the deed restrictions are only the tip of the iceberg.

From the moment that CID communities began proliferating in the 1960s, there has been serious trouble with their private governments run by amateurs. Like all sales people, the agents will play up the positives and play down the negatives; however, their own silence on this issue will tell you exactly in what category they think the CC&Rs and HOAs should be placed.

oh, did I forget to tell you about the CC&Rs?
My own experience and that of my neighbors should serve as a warning to all in the market for a new home in a CID.

In 1994, I had a house built in the new sub-division of Shavano Ridge in San Antonio, Texas. The construction process took eight months. In that entire time, neither my agent, nor the developer’s sales agent ever mentioned that the house I was building would come with deed restrictions and an HOA.

These were not condominiums or townhouses but single-family homes. The buyers themselves designed the exteriors of the homes choosing from a vast selection of available materials. There was neither a standard of appearance nor any recognizable common areas (park, pool, clubhouse) to reveal the existence of a CID. I didn’t find out the truth until the moment before I was asked to sign the deed. Gross misrepresentation was also a part of the sales pitch. When I began to balk at signing the deed, my friend the salesman (sounds like an oxymoron doesn’t it) reassured me with these words:

“Don’t worry, it just means if you want to add a room, you have to get permission.” Centex sales agent

Of course, if you know anything about CC&Rs and HOAs, you know the monumental scale of this particular deception. It’s a sales technique that is common practice among sellers everywhere. The less you know the better.

Yeah, I know what you’re thinking, “buyer beware,” and you’re right, I should have been. I was naive and gullible, which as you will see is something of a chronic condition with me, but this was all new at the time. You on the other hand have no such excuse to fall back on. If nothing else, I would hope you at least have your antennas up by now.

What these agents did, and what most of them do, is interfere with a buyers ability to gain access to, read, and hopefully comprehend the true meaning of the CC&Rs. Sellers think deceptive sales practices are the only way they can sell, what many people believe to be, a very defective product.

silly me, did I forget again?
I conducted a survey of our entire neighborhood (something I will suggest you do in a later chapter) and found that 59% of those that responded (28% of the neighborhood) said their selling agent did not give them enough information to make a well informed decision to buy.

Just before I sold my house, leaving behind CIDs, and CC&Rs, and HOAs forever, I attended my last general meeting of the association. I hated going to these things, but I made a lot of noise within the community and therefore felt obligated to show up in support of those who shared my opinions. At the end of this traditionally venomous ritual, one of our newest residents stood up and grumbled to know one in particular, “they can’t tell me what to do, this is America. I know my rights.”

It turns out she bought into our CID and had absolutely no idea what she had got herself into. She said her real estate agent never mentioned the CC&Rs, but she said she did get a lot of papers after the sale closed.

What could I say. She finds she has been bamboozled into buying a house in a CID and then tries to bolster her courage by waving her rights as an American citizen in the faces of the mongrel horde.

I just didn’t have the heart to tell her then what I’m going to tell you now.

Actually, I’ll let Mr. McKenzie tell you.

“Resident in CIDs commonly fail to understand the difference between a regime based formally on rights, such as American civil governments, and the CID regime, which is based on restrictions. This leads to people becoming angry at board meetings and claiming that their rights have been violated - rights that they wrongly believe that they have in the CID.” Evan McKenzie, Privatopia

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