Property owners are now being faced with another attacker: Homeowner’s Associations.

Normally, it’s the finance companies who go after delinquent property owners . But in areas governed by the all-powerful HOA , as the sour economy leaves more people unable to pay their fees , the HOA can be a horrible monster.

In the past, HOAs have gained infamy for dictating everything from the weight of your dog (one mandated a diet for a hound) to whether you can kiss in your driveway (not if you don’t want a fine) . Homeowners’ associations have served as the behavior police, banning solar panels, lemonade stands, and hanging out in the garage. One ordered a decorated war veteran to remove his flag because of a “nonconforming” pole . Another insisted that home owners with brown spots on their lawns dye their grass green.

Now, many property owners in HOAs owe more than their homes are worth. In financial straits, they’ve stopped paying their association dues . To combat the rise in delinquencies, boards are switching off utilities, axing cable and even garnishing income . They are banning the billiard room and yanking pool passes . In the most extreme cases, they are foreclosing.

“The treacherous part is that homeowners’ associations are acting like a local government without restraints, and they have this extraordinary power,” says Marjorie Murray, a lawyer and founder of the Center for California Homeowner Association Law.

Today, one in five U.S. property owners is subject to the will of the homeowners’ association , whose boards oversee 24.4 million houses . More than 80 percent of newly constructed homes in the U.S are in association communities.

And of the nation’s 300K HOAs , more than 50 percent now face “serious financial problems,” according to a September survey by the Community Association Institute. An October survey found that 65 percent of homeowners’ associations have delinquency rates higher than 5 percent, up from 19 percent of associations in 2005.

The government does not keep statistics on how often HOAs foreclose on homes under their power . But a nonprofit research group found that association-initiated foreclosures in the Houston area jumped from 500 in 1995 to 2,200 in 2007. Most association -related foreclosures in Texas do not go through the judicial process, so the group’s analysis represented only a fraction of the foreclosures that housing associations have initiated.

All the association board must do is alert its attorney to place a lien on the home to start the process. The home can then be auctioned by the board until the bank eventually takes ownership. Homeowners generally have no right to a hearing.

This whole process; the over-reaching power of the associations, is fueling the recent increase in public interest in small floor-plan housing. More and more property owners are exiting manicured suburbia, and deciding to erect a small homestead on modest properties pretty much anywhere. The freedom of a tiny floor-plan is that it can litterally fit just about anywhere. The lifestyle change seems to be the biggest challenge, but for those who have made the change they see the difference as more liberating than daunting, as they embark on a lifestyle that requires that they get creative, innovative , and make it a priority to cut the clutter and excess .

California manufactured homes sales have been steadily rising throughout our recent recession, as more and more people flee the HOA lifestyle. All you need is a little piece of land; because even a tenth of an acre becomes a wonderous playland of gardens when not entirely taken up by a hulking McMansion. Manufactured homes seem to be the go-to answer for the small home movement, making it essentially effortless to design and build the perfect home quickly and inexpensively . Floor plans designed for storage are far easier to create in manufactured home designs than in traditional construction.