Financing Barriers?
Conventional lenders evaluate HOA delinquency rate, reserve funding, and deferred maintenance, NOT rental percentage. Fannie Mae Lender Letter LL-2026-03 and the March 2026 Freddie Mac Bulletin permanently retired the 50% investor concentration limit.
Not one Laurel Bay buyer has ever been denied a loan due to rental %.
This was never disclosed by the rental cap committee during its door-to-door outreach or at any of its online or in-person events. Instead, the committee asserted the opposite, alarming owners by spreading disinformation.
While access to FHA loans would be limited if rentals were to go above 50%, (and right now the rental percentage in Laurel Bay is 45% and dropping!) those loans are of almost no use to a buyer in Laurel Bay. FHA loans are designed for entry-level buyers. The average FHA buyer wouldn't qualify for the price point of a Laurel Bay unit.
But what a rental cap will do is eliminate ANY buyer using a VA loan. The reason. The VA Loan Network will not approve a loan into a rental-capped HOA. Source: https://valoannetwork.com/va-home-loan-hoa-ccr/
Click on the PDF for a deep dive with sources.
Conventional lenders DO NOT look at rental percentage when approving loans (source above)
Laurel Bay is an upscale development in a highly desirable area of San Diego. The prices for our units are currently in the $600,000 to $900,000 range. We challenge the rental cap committee to enumerate any FHA financing that has occurred in the past 5 years.
50% rentals is an imaginary benchmark. It has essentially no effect on lending in Laurel Bay!
We use factual truths to make our statements against a rental cap. We are against speculations, opinions, and emotional statements with no proof.