- August 21, 2020
- Posted by: Scott
- Category: Article, associations, Business plans, communities, Community, Development, Economics, Finance & accounting, Funding trends, HOA, homeowner association
When it comes to housing, there are a lot of variables and options for buyers to juggle. One thing that might affect your buying decisions are homeowner’s associations (or HOAs for short). HOAs are organizations that manage and oversee common property within a community, subdivision, or condominiums. They aren’t as directly involved as landlords of a rented property, but they hold some measure of control over the community they oversee.
Who Manages the HOA?
People who live in HOA communities are subject to certain rules and regulations that were determined when the development was established. HOAs may have a governing Board that is elected by their association to oversee the care and maintenance of the entire subdivision. This Board is made up of volunteers from the community and the positions are unpaid. It’s the Board’s job to make sure that the neighborhood amenities are kept in good shape, the needs of the members are being met, and that everyone is following the rules they agreed to when they purchased their home.
Benefits of HOAs:
When you buy property within the boundaries of an HOA, you automatically become a member of the association. You will also share in and have access to all of the neighborhood benefits and amenities!
Every HOA is slightly different when it comes to their amenities, but there is always some kind of perk to every association. Sometimes it’s a community pool, an event center, or a playground. Other possible benefits include services you might not otherwise get, such snow removal or trash collection. As an added bonus, property within HOA communities tends to have higher resale values than subdivisions without an association. Because everyone shares a common interest in their association, most homeowners follow the rules to maintain a beautiful and well-kept neighborhood, so it’s easier for new buyers who want to move into the community. According to a 2017 housing value study, selling a home that’s part of an HOA can increase the property value by 4.2%.
Responsibilities and Costs of Membership:
These benefits do come with a cost, however. It takes time, money, and labor to keep a community looking beautiful. While the Board are usually unpaid volunteers, the amenities still come with a cost. To help cover this, HOAs require members to pay a recurring fee in order to keep things running smoothly. These fees are equally divided among all property owners, thus, the more amenities, the greater the cost to maintain them.
When you become a member of an HOA, you have a legal responsibility to follow the guidelines laid out in the Covenants, Conditions and Restrictions or what is generally called CC&Rs. CC&Rs are basic rules that all homeowners agree to follow. These rules may vary from one HOA to the next, but they can include anything from whether or not you can rent out the home, to how long Christmas lights can stay up. In order to maintain a high-end community with high resale values, these rules are strongly enforced.
Your Role in the Association:
Despite the restrictions, the homeowner rules don’t mean that you have to sacrifice your individual needs; they’re intended to be a basic agreement to preserve property values. Homeowner Associations exist to create, maintain, and improve communities. As a member, you have the right to bring your own requests to the Board and ask for their consideration. Happy members make a happy association!
For more information, contact MGM Association Management at (208) 846-9189 or visit, www.gomgm.com.