What is a homeowners association? What benefits do they provide?
A homeowners association (HOA) is a community comprised of homeowners within townhome complexes, condominiums, or subdivisions. The goal of an HOA is to preserve the overall community. Here are some of the benefits provided by living in such an arrangement:
1. You get access to certain amenities like swimming pools, gyms, or door staff when you pay into an HOA.
2. Your utilities are often included in your HOA fees, like your heat, gas, and sometimes even your cable/internet package.
3. Maintenance costs are sometimes shared. For example, if you live in a complex that needs a new roof, all the owners can come together and pay a portion of the cost for the repairs. If you lived in a single-family home, you’d have to pay out of pocket.
4. You get to know your neighbors better. Many HOAs host social events like holiday parties, pool functions, fitness classes, and so on.
Now, there are some downsides associated with living in a homeowners association as well:
1. Monthly HOA fees. Your HOA will require monthly dues that will never go away—in fact, they’ll almost certainly go up. As the building gets older, general upkeep must be maintained, wages for door staff increased, and other costs are levied, all of which are paid for through HOA fees.
2. Your hands are tied. For example, if the lobby needs a full $200,000 renovation because it’s old and outdated, and you don’t like the finished product… well, your say only goes so far. The entire building may have voted on it, but if there are 500 units, it’s possible that you may end up with something you don’t approve of.
3. Special assessments. If, for example, your building requires a huge project like new windows, but the association itself is not budgeted for such a project, what happens? Well, owners will be specially assessed for a certain amount of money to cover the costs. That could be anywhere from $5,000 to $50,000, depending on the building, how much work needs to be done, and how much money was held in reserve by the HOA.
Hopefully, this gave you a better understanding of what an HOA is and what benefits (and drawbacks) they provide to those who live within them. If have any questions about homeowners associations or how they operate, don’t hesitate to reach out to us via phone or email. We would be happy to help you.