If you're looking to purchase a property in a neighborhood, community or building with shared common areas (like a pool, clubhouse, parking garage, etc.) or even a security gate, it's likely the community or neighborhood is maintained by a homeowners association, also known as a HOA. When you move into a community maintained by a HOA, you are obligated to join the association and are responsible for any monthly, annual, or special HOA fees that come along with the association. But what is a homeowners association, and what can a HOA do for your community?
The primary purpose of a homeowners association is to manage a neighborhood's common areas such as roads, parks and pools. The HOA ensures the community looks its best and functions smoothly. Management isn't normally free, so owners are expected and obligated to pay monthly or yearly dues to the association that go toward the maintenance and upkeep of the community. Homeowners are also obligated to live by the association's rule book, also known as covenants, conditions and restrictions (CC&Rs).
If you purchase a property in a community with a HOA, you are locked into abiding by the rules and regulations of the HOA. Depending upon how detailed the CC&Rs are for the community, everything from the size of a dog to the type of mailbox you have to whether or not vehicles are allowed to park on streets can be dictated by the HOA's CC&Rs.
While many of the rules within a HOA may seem tedious and unneeded, the goal of the HOA is to maintain a specific aesthetic throughout the community. For some, this brings value in that yards are maintained, house colors remain true to the originals of the neighborhood as a whole, trash is not on display for others to see, and overall the community is kept up and thrives. For others, especially those that don't like having to adhere to a list of rules, the HOA can be limiting and its rules bothersome.
While it may seem like the CC&Rs of a HOA can be easily ignored, it's best to stick with what's safe when it comes to your home and the community's guidelines. In many areas, violation of the rules or not paying monthly/yearly/special fees can lead to notices and fines. In some communities, owners can even be evicted or their properties foreclosed on if violations become egregious. Depending on where you choose to live, knowing the rules set forth by the HOA before you lock yourself into a property is a must, especially if you're the type of person that likes to the toe the line when it comes to sticking to a rule book.
A positive part of a homeowners association is that it provides a way for the homeowners to actively participate in what's going on in their community. The association generally has a board, made up of members of the actual community who are voted into their positions. If you like being active in your neighborhood or building, joining the HOA or attending the monthly meetings is a great way to stay up-to-date on the regular goings on of the area.
For some, a homeowners association is a great addition to a neighborhood or building in that it guarantees the upkeep of the shared spaces and ensures a certain quality level is maintained by every homeowner. While it may seem like there are a lot of rules, the rules help to keep up the general appearance of the properties and help keep the resale value of the community up. For others, the many rules can seem like a power grab, limiting their freedom of expression and dictating what they can and cannot do with their own property.
In any case, if you're considering a home or property in a community with a HOA, don't be afraid to ask some of the current owners how they feel about the homeowners association, and ask your agent for any information s/he can provide about the association before you make your final decision, including:
• What are the monthly/annual fees associated with living here?
• What does my HOA fee cover?
• How often do HOA fees increase?
• By how much do HOA fees increase?
• What are the HOA rules?
• Current or anticipated special fees
• Number of units that are owner occupied & percentage of units the HOA allows to be rented
Definitely ask for a copy of the association bylaws and CC&Rs as well as a copy of the three most recent financial statements and association minutes. Review these carefully to help you determine both the association topics currently being discussed and the financial condition of the association. Owning a home within an HOA can be a positive or negative experience.
Doing your homework before purchase and getting help from your Realtor will help your experience be a positive one.
Team Leader, The Tonnesen Team
Berkshire Hathaway HomeServices, Nevada
3185 St Rose Pkwy #100 Henderson, NV 89052
With over 30 years of experience helping families call Las Vegas "home!"
Related Blog Posts
Credit: www.mycreditguy.com "When I see credit reports with lower scores, there is almost always one factor in common, high credit card utilization. Check out this quick video that will talk about how the credit scoring algorithm factors in your "balance to limit ratio" and how you can actually use this to your adva...
Las Vegas real estate is on the rise and is showing no signs of slowing down. The interest rates within the housing market have kept the city hopping and remaining in full form without ever skipping a beat. These phenomenal interest rates have been the deciding factor in why so many people are getting themselves int...
They say that a picture is worth a 1000 words – in real estate, that can be a good thing or a bad thing. Even keeping in mind that real estate agents are not professional photographers, over the years we have seen some real doozies posted on the Internet! Those are the ones that are certainly not going to sell the ho...
A True Story from Debra Leatham> At a recent closing where I represented the Buyer, who lived in the San Diego area, he had to sign his escrow documents via a Signing Service chosen by the Title Company. After signing his documents mid-morning on a Monday, he took the wire instructions to his bank, Wells Fargo, ju...