Definition
A limit on the percentage of units that can be rented to tenants rather than owner-occupied. Caps preserve owner-occupancy and community character but limit your rental flexibility.
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Rental caps preserve owner-occupancy and community character by limiting investor-owned properties. Common limits are 20-25% of units. Caps may restrict your ability to rent if you relocate. Some HOAs prohibit rentals entirely. Investors should confirm rental permissions before purchase.
Pro Tip
Confirm rental availability before buying if long-term rental plans exist. Restrictive caps eliminate income flexibility.
Example
An HOA rental cap of 25% means maximum 50 of 200 units can be rented; reaching capacity prevents further rentals.