HOA stands for Homeowners Association, and it is found in subdivisions, apartments, condominiums, or planned communities.
An HOA is a group of residents from those properties forming an association to focus on the balance, security, and needs of the community.
Before getting a property, the HOA is something you should consider because there are a lot of factors that can affect your decision in buying the property.
Things you should consider with a community’s HOA
Asking your realtor about an HOA
For someone who has been selling properties, your realtor has information and an opinion about the community’s HOA.
Ask for their honest opinion and carefully asses the sales talk and personal talk. Ask questions like “Would you personally live here?”
Your realtor has sold properties and has friends who are realtors too. They might give some information about the neighborhood that you would not expect.
Asking for the minutes of an HOA meeting
Asking for a copy of the meeting’s minutes can give you an overview of what discussions are brought up. This way, you can get a little background on the HOA’s priorities, concerns, and other topics that they feel important to bring up during the meetings.
Sitting in on an HOA meeting
If you have more time, you can sit in on an HOA meeting to listen and get a glimpse of what the community’s concerns and problems are while also checking on how they come up with solutions to resolve the problems.
In addition, you can see the HOA’s bond or friendship. Are they friendly, decent, or chaotic?
It may be time-consuming to sit down through a meeting, but you can consider it an investment since you’re going to be a part of those meetings soon.
Getting into the HOA politics
Aside from that, HOA is somewhat political where some members may want to be elected as the head or president of the association. Just like how any other politics work, this might create tension for a person who is not into politics.
Projects of the HOA
Projects and events can vary from children’s activities and fundraisers for nonprofit organizations to casual parties. Some HOAs are active in events and will encourage you to attend these gatherings.
If you are an introvert who feels like socializing can be tiring for you, I suggest you keep an eye out for the HOA’s perspective on social gatherings.
Checking your temperament
Also, you have to consider your temperament because if you are someone who does not like being told what to do, being in a strict or uptight HOA can cause additional stress in your home. It won’t feel right coming home after a long day of stressful work to an environment where you don’t feel at peace.
Checking the HOA’s rules
The HOA’s board of directors enforce rules and policies within its jurisdiction and also collects fees from all the residents in that community.
Some of the rules enforced are landscapes on your lawn or garden, fencing of your house or lot, or even the colors you choose to paint your house.
What happens when you break an HOA rule or policy? This depends on your situation and the rule you broke. Some consequences are forced compliances or paying penalty fees.
In severe cases, this can actually cause you to get kicked out of the community or—even worse—go through litigation.
What are the HOA fees for?
HOAs collect fees from their residents monthly for the benefit of the community. Fees are needed to maintain the swimming pools, playgrounds, tennis courts, clubhouses, lobbies, lawns and landscapes, and other common areas in your community that everyone uses.
In addition to this, there are utilities like the sewer and water fees and garbage disposal fees. When you have utilities that need to be repaired, like broken elevators or getting a new roof for the clubhouse, HOA fees will cover that.
Double check what you are investing in by checking where the HOA spends its fees. You can observe and casually talk about it with the community’s residents and gather information regarding this because the residents will have something to say since they are getting benefits from the HOA fees.
And if the residents don’t have something to say? Then it’s time to think through if the property you’re about to purchase is really worth it.
How much are HOA fees?
The fees vary with each HOA, and they range from $100–$700 with an average of $200. The more your utilities and amenities are, the more your HOA demands fees. So, be sure to check the HOA and its fees before sealing the deal of a property.
The HOA fees are not the same forever though. As the economy goes up, so do the HOA fees.
Running away from HOA fees can bring consequences. Some HOAs charge penalties for late payments, and others can initiate lawsuits. You should be careful and read the contracts before purchasing a property to make sure you know what you are getting into.
Weighing the Pros and Cons of HOAs
According to CAI’s Homeowner Satisfaction Survey for 2018, 85% of residents are satisfied living under their HOA with 63% residents rating it as positive and 22% residents rating it as neutral.
Pros of HOAs
HOA can provide access to their amenities such as tennis or basketball courts or other sports facilities the community has. You can access the community’s gym or fitness centers, and if you have kids, they can have fun on the playground. Some communities have clubhouses that you can use to host events, or you can enjoy the day swimming at the pool or other amenities that the community offers.
Keeping the sewer or the garbage disposal clean and well-maintained can be a pain. HOAs are there to manage these things and get service for everything. There are also services like snow removal or fixing of roads that brought up for discussions to ensure fast service if these problems arise. While you simply pay your monthly fees, these responsibilities are taken off your shoulders.
When HOAs meet, they don’t only discuss issues that are happening; they also talk about personal things and are friends. This can help you a lot when you need to borrow something from a neighbor, need some help, or want someone to tag along with during golf. HOAs are pretty useful for your social life.
Resolving disputes with a neighbor
Sometimes, there can be misunderstandings between neighbors, whether small, petty issues or big ones. HOAs have the ability to step in and be the mediator that will help you and the neighbor assess the situation and come up with solutions that will give a win-win for both parties.
HOAs host events and parties that will help you get out of the house and have some fun. There are also nonprofit events that are organized by the HOA to raise funds or awareness. This can be a good thing for you to help with.
Additional safety and security
Traveling in the next few days with no one to watch the house? Your neighbors across the street can act as free surveillance cameras. You can tell them to watch the house from time to time or to call you if they see something suspicious.
Assuming that you’ve established good relationships with your neighbors, they will care for you and be your friends. This will give additional security to you and your house.
Cons of HOAs
Monthly expenditure woes
HOAs will have fees that are paid every month, and if you’re on a tight budget, this can be a problem. If you were not able to pay your HOA fees, there will be consequences from penalties, possible foreclosures, litigations, or even not having access to acquiring loans.
Losing your freedom
There are certain standards, rules, and policies set by the HOA that might lose you your freedom, like choosing the paint color for the house, having a nice fence that is against the regulations, or setting up something decorative that isn’t allowed.
Those are some examples of rules. Each HOA is different, so you have to read everything to check your limitations of the freedom the community offers with the property you are buying.
Bad management or HOA politics
There are HOAs that appoint their leaders by election, having the residents vote who they think is the best fit to be the president of the association.
And there are HOAs who have their leaders selected in a random way. This can be a bad thing since the association may be undermanaged. There might be problems in the community that you experience, and there won’t be anyone to help and step up to solve it.
Also, there are possible “rogues” among the board members who might bring in problems to the neighborhood, doing what they think is beneficial for the community but actually isn’t.
HOA’s problem is your problem too
When the HOA is encountering a problem, you might actually get drawn into it too. Since you’re all living in one neighborhood and the residents’ opinions are there, you can actually get caught up with all the drama.
There will always be pros and cons to everything. You just have to weigh the advantages and disadvantages depending on your personality, current situation, and budget.
There are people who think HOAs are a hassle and annoying, and there are some who enjoy it. This all just depends on who you are and what you do.
Buying a new home and looking into the surroundings, environment, social life, and the association that comes with it can be a burden, but you have to face this in order to identify if what you are investing in is worth the money you are paying.
Maybe the community’s HOA can make you feel comfortable quickly, or maybe they can add more stress from the process. Just take time to think things through carefully when choosing a new property that you can call home.