Horry County ranks top in the state for HOA complaints

Updated: Jan. 31, 2020 at 6:54 PM EST
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MYRTLE BEACH, S.C. (WMBF) - The South Carolina Department of Consumer Affairs released its 2020 HOA Complaint Report on Friday.

The department received more than 200 complaints in 2019 against 143 homeowners associations across the state.

Horry County residents filed the most complaints, accounting for 22% of those statewide.

Complaints from Charleston County accounted for 12%, while Richland and Aiken counties tied for third across S.C. with 10% of the complaints each.

Forty Horry County HOAs were listed in the report, with more than half located in Myrtle Beach. The complaints range from failure to adhere to bylaws to maintenance concerns to failure to produce financial statements.

Horry County residents claimed their HOAs met without proper notice, misappropriated funds, denied requests to inspect records, and never responded to members’ concerns.

Since the 2019 HOA Complaint Report, both Horry County and Myrtle Beach rose in rank for most complaints.

The 2019 report only included six months, but Richland County was the top county and Elgin was the top city.

South Carolina lawmakers passed the South Carolina Homeowners Association Act in 2018. Part of the law requires the Consumer Affairs Department to compile the annual HOA Complaint Report.

The department reports complaints increased by 82% since the law was enacted.

“We had more HOA complaints in that six months from when it was enacted than we had in years, so that’s the portion that we feel really good about. People are concerned,” said Bailey Parke, a spokesperson for the Department of Consumer Affairs. “They can see they can come to us and complain about HOAs, even though they could have forever. They now know it might turn into something.”

Parker also said since the law was passed, the department has been more successful in getting responses from HOAs.

“The majority of the HOAs in the past would not respond at all, like they just wouldn’t. It wasn’t a thing and now the majority of HOAs are responding,” she said. “I think now that they know they are being specifically looked at because of this HOA report, I think they’ve started responding more because of it.”

Seven court actions are pending against HOAs, according to the report. Parker explained this means the consumer or HOA alerted the state that there is legal action being taken related to the complaint. She said the department does not have the authority to take legal action against HOAs.

Of the seven, two are from Horry County. Parkland Property Owners Association has pending legal action for failing to produce financial statements and failing to notify residents of boards’ actions, according to the report. A complaint alleging misappropriation of funds from Island Palms in North Myrtle Beach is also listed with pending court action.

Rose Run HOA in Pawleys Island is another associated with pending court action.

The department reported more than half of the complaints ended with a satisfied customer and adequate business response.

Forty-three percent of the complaints stated governing documents were obtained after purchase. The 2018 Act mandates these documents need to be filed with the clerk of court.

In the past, critics have called the law ‘toothless’ and some Horry County lawmakers said they wanted the law to go farther.

While the Department of Consumer Affairs collects the complaints, there is no department regulating HOAs in South Carolina.

Parker said lawmakers are required to review the annual report each year and the findings may lead to further legislative action in the future.

“There is an idea that maybe if there were enough complaints or there’s enough problems, we’re hoping that in the future it’s something that can be looked at again,” Parker said. “One of your rights is to file a complaint against a business or an HOA so do that, exercise that right. You may not get a guaranteed satisfied ending, but we are certainly going to try to help you out.”

The annual report also allows residents to recommend changes in state law. Many of the recommendations were related to setting parameters for viewing records and forbidding HOAs from placing liens and foreclosing on homes.

A S.C. lawmaker filed a bill this session that would take foreclosure powers away from HOAs.

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