In 2008, voters passed Prop. 100, a constitutional amendment to prohibit the state, county or city from charging a transfer fee on the sale of a home, by a margin of 77% to 22% a constitutional amendment to prohibit the state, county or city from charging a transfer fee on the sale of a home.  

Unfortunately, the ballot measure did not include a prohibition on private transfer fees and a new property transfer fee scheme arose in which third-party companies enter into agreements with developers to record permanent covenants and liens on each home built.  

Subsequently, each time the home is sold – for as long as 99 years – a percentage of the sales price is diverted back to the developer and the third-party company. This happens even though the developer and third-party company don’t own the property and don’t pay any portion of the mortgage, remodeling costs or other improvement expenses.  

AAR felt that this scheme was an abuse of the CC&R’s that are commonly recorded on residential property, an abuse that takes a home seller’s sales proceeds and provides nothing to the homeowner in return except increases in cost. This scheme is a risk-free high-reward effort for everyone – except the homeowner. 

HB 2768 prohibits third party companies and developers from creating real property transfer fee covenants. Yesterday, Governor Brewer signed HB 2768 into law helping homeowners in Arizona protect and maintain their private property rights!