How Do HOA’s Work for Homeowners?
February 18, 2018 | By: RealManage
When you start looking for a new property, you may find yourself with a long list of considerations. Among them, you may wonder what exactly it means to belong to an HOA or Homeowners Association. What does an HOA do for you as a homeowner? What are the specific requirements and what exactly you need to do if your new home is an HOA? Being a member of a homeowners association (HOA) can often be confusing and require additional information from your lenders and real estate agent before you make the decision to buy a property that is governed by these types of organizations.
HOA Defined
A homeowner’s association, more commonly called an HOA is an organization in a subdivision, planned community, or condominium (COA) building that makes and enforces rules for the properties and its residents. Those who purchase property within an HOA’s jurisdiction automatically become members and are required to pay dues, known as HOA fees. Some associations can be very restrictive about what members can do with their properties.
Is Membership Optional?
Many first time homebuyers or even experienced homebuyers who are new to HOA may be curious if this is something they can opt-out of, or simply not join, but the structure of an HOA requires that all homeowners in the community, whether owning prior to or after institution of the association, are regulated by it and are not able to simply not participate. Your Realtor® should be able to discuss any and all expectations for homeowners in a particular community and it should be something you address before making any purchasing decisions.
What are HOA Dues or Fees
The amount of an HOA’s dues vary immensely across the country and even from neighborhood to neighborhood. Most of these dues get paid annually, often referred to as your “Annual Assessment” but your HOA may have a monthly fee setup or may require you to pay certain fees in addition to your annual dues at certain times of the year in order to manage unexpected maintenance or other unanticipated expenses. You may pay a relatively minimal annual due designed to help offset the cost of specific services and maintenance for already accounted for common areas, or you may pay a higher fee for more involved services or specialized vendors.
It is very important that you read and understand your communities rules and regulations regarding financial responsibility as the way that dues or fees are assessed should be clearly outlined for all board members and homeowners. You may also be required to vote on financial matters regarding your communities fee structure and it’s important to be aware of your rights when it comes to making those payments.
Your HOA will institute some rules about maintenance and upkeep on your property.
Depending on your community and the board serving during your tenure, you may, for example, have to seek approval for adding buildings, including sheds or playhouses, to your property. There may be limits to things that can be displayed on your property. You may have to mow your grass at specific intervals or adhere to specific regulations with regards to the colors of your house or other specific needs. What rules you face will depend on your specific HOA and, for the most part, the desires of the residents. Make sure you review HOA rules before moving in. Some people do not appreciate the restrictions issued by their HOA and may struggle with conflict as a result.
Not adhering to these rules and regulations can actually result in fines, legal action and in some cases liens being placed on your property. Similar to any governing body, the HOA has many resources at its disposal to ensure compliance. These rules and regulations are not designed to punish non-compliant owners, rather they are designed to ensure the longevity and usability of the community’s home values and common areas.
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