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Since China's marketization‐featured housing reform, homeowner associations have played a greater role in neighbourhood governance. Using the theory of social movements and organizations, this article investigates how homeowner associations strategically reorganize themselves to achieve their goals. Our survey in Beijing suggests that about half of the homeowner associations have adopted bottom‐up governance structures, which are not specified in governmental regulations. We find that such innovations are more likely to occur when a neighbourhood needs grassroots participation to deal with external grievances, especially developer‐related issues, or to overcome its powerlessness due to little access to the polity. We also find that homeowner associations are more likely to adopt bottom‐up structures when their leaders believe strongly in resident participation or actively engage in extra‐organizational professional activities as a means to overcome infrastructure deficit.