The Growth of Home Based Businesses Proliferation is Forcing Boards to Amend Their Bylaws

According to U.S. Small Business Administration statistics, over half of all small businesses begun in the last decade have been home-based—that's more than 24 million in real numbers—with a new home-based business being launched every 11 seconds. And according to U.S. Census figures, some 100,000 New Yorkers work from home, with more switching all the time.

Those numbers should not be lost on co-op and condo board members, some of whom still preside over buildings with express prohibitions against home-based businesses. But should associations move to amend their governing guidelines, often requiring an amendment to the property’s governing documents, declaration or master deed, to eliminate these provisions? Yes, say experts in both business and legal fields.

Efficiency & Sustained Growth

“There’s been so much outsourcing,” notes Los Angeles-based author and self-proclaimed “serial entrepreneur” Phil Holland. “Firms are learning that it’s, in some cases, much more efficient and less costly to outsource work than it is to have employees in offices, so that has kind of propelled the home-based business thing. And for people who haven’t found work and are unemployed, it’s not a bad alternative sometimes to start a home-based business.”

Holland has been involved in mentoring new business owners since the mid 1980s, and wrote a book about his experiences called The Entrepreneur’s Guide. His current venture is a not-for-profit website—www.myownbusiness- .org—which provides in-depth online courses to assist first-time entrepreneurs.

Holland says he’s seen sustained growth in the annual rate of home-based business startups since around 2000. “We began learning that the economic climate does indeed have hiccups,” Holland notes. Over the past few years, Holland says the rate of HBB growth has increased for two main reasons: “One, the adverse economic climate is propelling people to start home-based businesses. And two, the tools are now available to help them.”

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