Arizona Legislature Enacts Sweeping Laws Curtailing HOA Powers

Roughly 2.275 million Arizonans live inside an estimated 10,300 HOA communities, according to reporting by the Arizona Republic, which puts the state 11th in the country for how much of its housing sits under a homeowners association. Six bills touching homeowners associations and condominium associations became law on September 12, 2026, and between them they cover foreclosure, board conduct, buyer disclosures, and a handful of things an HOA can no longer forbid outright. 

Condo owners in Arizona just got the same 18-month, $10,000 cushion HOA owners have had since 2025 before an association can go after their house. Planned communities and condo associations are governed by separate statutes in Arizona, and until this year they played by different foreclosure rules. Planned communities went first. In 2025, Senate Bill 1494 raised their foreclosure threshold, moving the bar from one year behind or $1,200 owed to eighteen months behind or $10,000 owed, whichever comes first.

Condo associations didn’t enjoy that same protection until this September. Senate Bill 1246 took effect on September 12, bringing condo owners onto that same eighteen-month or $10,000 standard, more than a year after planned communities got it.

Even if a surprise assessment pushes you over $10,000, that alone can't trigger foreclosure. Only falling behind for 18 months can actually put your house at risk. One big unexpected charge isn't enough on its own; the association still has to wait out the clock.

None of this stops an association from charging late fees and interest, or suing you personally for the money you owe. What changed is specifically how long they have to wait before they can go after your home itself, and lawmakers pushed that timeline out further for everyone. As Dennis Legere, founder of the Arizona Homeowners Coalition, put it to the Arizona Republic: foreclosure is supposed to be a last resort, not something that happens early.

Condo boards now carry the same duty to act fairly that planned-community boards have had since 2007. There's finally a law to point to, instead of a court case almost nobody knows exists.  The duty traces to a 2007 case holding that a board has to use its power, enforcing rules, approving or denying design changes, reasonably: neutrally, fairly, without favoritism or arbitrariness. That's been the law for planned communities ever since, just never written into the statute itself. House Bill 4011 fixes that gap for condo associations, writing the same duty directly into their statute.

A separate bill, Senate Bill 1290, closes a related loophole, but only for planned communities. Their boards can no longer vote or make a decision behind closed doors. They can still meet privately to discuss sensitive topics like legal matters or personnel, but the actual vote or decision has to happen in an open meeting. Condo associations aren’t covered by this one, their meeting rules stay the same.

House Bill 2397 adds disclosures sellers in HOAs or condos must make to buyers, and at what point disclosures must be made. Sellers now have to hand over recent board meeting minutes, current insurance details, whether the developer still controls the board, any unpaid dues or liens on the property, the association's financial statement, and outstanding violations tied to it.

The clock also starts earlier. Sellers have to deliver that packet once a buyer's offer is accepted, not at the old, vague "pending sale" point, and it can go out electronically. If something in the packet is incorrect, a seller is only liable if they knew about it or should have, not for an honest mistake, as long as they relied in good faith on the association's own records.

The buyer's signature acknowledging the CC&Rs, including the association's power to foreclose without homestead protection, now happens at close of escrow instead of within fourteen days earlier in the deal. It's a small procedural shift, but it changes which meeting that conversation happens in.

A few narrower bills also took effect on September 12, covering shade structures and flag displays inside an association. House Bill 2342 stops an association from banning backyard shade structures outright, umbrellas, gazebos, and similar coverage. An association can still set reasonable rules on size, placement, and appearance, as long as those rules do not functionally block the structure, and are not more restrictive than what your city's own zoning would allow.

Senate Bill 1184 protects the display of division flags from the Army, Navy, Marine Corps, Air Force, Space Force, and Coast Guard, and removes a lien penalty condo associations could previously attach to a flag rule violation. Senate Bill 1808 separately protects the display of a flag from a nation classified as a major non-NATO ally established on May 14, 1948, which in practice protects the Israeli flag regardless of what a community's covenants say.

Not everyone thinks these changes go far enough. Phoenix attorney Jonathan Dessaules told AZFamily that the real damage in most HOA foreclosures comes from collection charges, not the assessment itself, and none of the six new laws cap what an association or its collection firm can charge on top of a past-due balance. Whether that gap gets addressed later, or whether the new 18-month, $10,000 threshold is protection enough, remains to be seen.

This is the year to check whether you, or the paperwork around you, actually caught up with these six new laws. Board members should have their management company or association attorney walk through what changed, since several of these provisions shift what counts as a defensible decision versus an arbitrary one. Buyers and sellers should confirm the disclosure packet reflects the current requirements, not last year's template. And if you haven't reread your CC&Rs in a while, this is a good year to pull them out.

This post was drafted with AI assistance. It has been reviewed, fact checked, and edited by me before publishing. All analysis and anything with a point of view is mine, and any opinions expressed are not those of eXp Realty or the Legacy Real Estate Team.

Sources

• Arizona Republic — new HOA foreclosure protections, scale of AZ associations, Dennis Legere quote (via Arizona Daily Star) — https://tucson.com/news/state-regional/article_554ab3c9-1edc-409f-bed6-56aefe820bb9.html

• Copper Courier — the six new Arizona laws reining in homeowners associations — https://coppercourier.com/news/housing/new-arizona-laws-homeowners-associations/

• AZFamily — Arizona homeowners get new protections against HOAs, Jonathan Dessaules on collection charges — https://www.azfamily.com/2026/09/16/arizona-homeowners-get-new-protections-against-hoas/

• Arizona Capitol Times — HB 4011 and the Tierra Ranchos fair-dealing standard — http://azcapitoltimes.com/news/2026/05/30/homeowners-gaining-ground-against-hoas/

• Arizona State Legislature — SB 1290 Senate Fact Sheet (planned community open meetings) — https://www.azleg.gov/legtext/57leg/2R/summary/S.1290GOV_ASPASSEDHOUSE.DOCX.htm

• Governor Katie Hobbs — 2026 legislative action update (bill signings) — https://azgovernor.gov/office-arizona-governor/news/2026/06/governor-katie-hobbs-legislative-action-update-1