If you’re looking to purchase a house or a condo, you will stumble upon homeowners’ associations at some point. According to Homeowners Protection Bureau, 70 million U.S residents were living under HOAs in 2017, a significant increase from 45.2 million in 2000. Considering the number of HOAs in the U.S has been on a steady ascent since the ’70s, there’s no doubt that these private communities are popular in the property industry.
On the other hand, as beneficial as a HOA association clearly is, there are bound to be drawbacks that unfortunately may not be palatable to some prospective homeowners. Therefore, it is imperative to understand what you are getting into before purchasing a property in a HOA community.
The pros of homeowners’ associations
Here are five advantages of living under the management of a HOA:
1. Availability of shared amenities
HOAs generally provide access to shared facilities such as pools, parks, sporting grounds, fitness centers, security systems, etc. Having access to these things yourself as an individual homeowner can be ridiculously expensive compared to sharing under the wing of a community HOA.
2. Shared maintenance costs
The mentioned community spaces require regular maintenance which is handled by the HOA. The dues you pay to the HOA monthly, bi-annually or as otherwise specified by your particular HOA goes into facilitating these services. The best part is the costs are shared.
3. Maintained property value
Usually, HOAs have a rule against property neglect which can easily decrease property value in the neighborhood. The HOAs help maintain the face of the neighborhood, and in turn, homeowners benefit from increased property value.
4. Dispute mediation
It’s not easy to get along with everyone no matter how nice you are. At some point, you might have an issue with a neighbor, but HOAs are good at third-party mediation.
5. Property responsibilities
There are many responsibilities that HOAs take off your shoulders as a homeowner, like keeping up with legal obligations and solving problems in the community. The HOA usually brings in a property management company like ACCU, Inc. which handles technicalities and oversees administrative operations.
The cons of homeowners’ associations
Not everyone is cut out for HOAs. You might want to keep in mind these downsides:
1. The HOA dues
HOA dues can be a burden you will have to bear if you choose to purchase property in a community living under an HOA. So, if you are going to be stretched tight, perhaps it’s best to steer clear.
2. Abiding by the rules
HOAs generally have a set of rules already in place which you have to abide by when you move into the community. The rules can be reasonable, but sometimes they can be ridiculous.
3. Your HOA’s problems are yours as well
If your HOA faces a financial burden or gets into a legal dispute, the expenses of such proceedings are passed on to you, the homeowner.
4. Renting restrictions
HOAs can put in place rental restrictions which can hurt you as a homeowner if you intend to lease your property.
5. Restrictions on making changes to your home
You might own your home, but a HOA might have regulations in place that limit and oversee any changes you wish to make; this can be something seemingly small like repainting.
It’s important to weigh the pros and cons of homeowners’ associations to figure out whether they align with your lifestyle or not. You can talk to a property manager working with the community association to gain insight into what to expect. You’re welcome to check out ACCU, Inc. for information about property management services.