Is a Homeowner’s Association Community Right for You?

You’ve probably heard the words “homeowner’s association” thrown around, and especially if you are in the process of buying a home. So what exactly is a homeowner’s association (HOA)? An HOA  is an organization in a subdivision, planned community, or condominium that makes and enforces rules for the properties in its jurisdiction.

HOAs provide services and amenities to residents within its community for a set fee much like a college campus. Although it may sound intriguing right off the bat, beware, you’ll want to carefully examine the upsides and downsides of various HOAs before you make any type of commitment.

Learn the rules

If you love to be outrageous and deck the outside of your house in thousands of Christmas lights and various wreaths, make sure you know how strict your HOA will be.

Some HOAs are sticklers about what you can do with your property. Limitations could range from what type of vehicle you can park in your driveway, to the fence height, what color you can paint your home, or how many Christmas lights can be hung and where.

Other HOAs are more free spirited and are just there to provide services and rules that ensure property values are staying up. Know what your HOA is like before you decide you want to move in. To get a better idea try attending one of their meetings to hear about past concerns and how they were dealt with.

Know the consequences

When considering an HOA community be sure you fully understand what will happen if you broke one of their rules. You may be able to find this information online, but if you cannot, be sure to ask your real estate agent to acquire these documents for you or contact the HOA yourself.

Try to pay particular attention to the rules which would result in fines if broken. Some HOAs have the power to foreclose on your property if you don’t pay HOA dues. Lastly, be sure you learn about how to add or change rules. If the rules are too limiting, consider buying elsewhere so you can have more freedom or at least the option to help revise current rules in place.

Calculate the cost

HOA collect fees to maintain common areas and improve the overall quality of life for the community’s residents. In some instances fees may be collected on a monthly, yearly, or quarterly basis and can range anywhere from $200 to $400. The fees you pay go towards various services and amenities. More often than not the fees will at least cover lawn care, trash removal, and snow plowing in the community areas of your neighborhood. However newer buildings, or larger buildings and communities, will include more amenities beyond the basic services. Remember though, more amenities equal higher fees.

Culture fit

Despite the cost and the sometimes strange rules in place, there are many benefits surrounding your involvement in an HOA community. Many people who have chosen to live in an HOA appreciate the sense of community. On top of knowing nearby friends and neighbors, living in an HOA community will oftentimes give you access to many other features such as a gym, tennis courts, swimming pool, etc.

You’ll want to make sure the amenities included are ones you will use frequently or else you’re paying for extra features you won’t ever use. Another thing to evaluate is the cost of the amenities in the HOA community versus the cost of the amenity by itself plus a lower monthly house payment. You’ll have to see which package offers you the best value for your lifestyle, not necessarily the lowest price.

HOA or someplace else?

The decision to live in an HOA community ultimately comes down to the type of lifestyle you would like. If you don’t mind paying a little more to have services and features you couldn’t get elsewhere, then perhaps you would feel right at home with an HOA. If living by someone else’s rules is going to add stress or frustration to your life, consider alternative options. The outcome of either decision is still a new home.

What other factors do you consider when looking at a homeowner’s association community?