Have you ever considered purchasing a home in a homeowner association (HOA)? If not, you may wonder about what being part of an HOA means for you. HOAs have been successful for so long for good reason. But while many people love this type of arrangement, it is not necessarily for everybody, and there are certainly advantages—and drawbacks—to consider before you commit to buying a home in an HOA.
The Bright Side of HOA Living
The bonuses of HOA arrangements are many. Commonly included services and benefits with this type of ownership are:
- Maintenance: Many HOAs consider your lawn and garden common space, so they maintain your yard for you. Other maintenance tasks that HOAs cover include snow and garbage removal. This frees up the time that you would otherwise spend on these chores.
- Amenities: Facilities included vary from neighborhood to neighborhood. Many build gyms, pools, clubhouses, tennis courts, and playgrounds. When you pay HOA fees, you’re paying to use all of the common amenities in the subdivision. Often, these facilities are located just a short walk from your home.
- Mediation: Disagreements or arguments with neighbors are often an unfortunate fact of life in community living. HOAs can serve as an impartial mediator in disputes between neighbors, helping find compromises that work for both parties.
- Aesthetics: Regulating the look of a neighborhood — ensuring it stays clean, well maintained and cohesive — keeps property values high and rising. As part of an HOA, you may not always get to make decisions on how your house looks … but then again, some people prefer it that way.
Potential Pitfalls of HOA Living
The benefits of being under an association are many, but here are some factors that don’t always sit well with everyone:
- Fees: HOA dues can be relatively expensive. Fees usually range from $200 to $400 a month. Because of this, a mortgage on a condo and HOA fees can cost more than a mortgage on a larger home. So make sure you account for the fees when you calculate your monthly payments. If you don’t pay your dues, the HOA can put a lien on your home or force a foreclosure. If you fight it in court and lose, you will have to pay the association’s legal fees, creating even more expense for you.
- Rules: Some people consider their HOA regulations excessively strict. Some HOA rules restrict pet size and type, exterior decorations, and forbid renting. HOAs enforce these rules by levying fines for disregarding them. It’s highly advisable to read the rules carefully before buying, to identify any HOA regulations you may not want to live under.
- Management: HOA boards are usually comprised of volunteers. When your neighbors manage make HOA decisions that you don’t agree with, it can have direct impacts on your life. Over-management isn’t the only concern. The neighborhood suffers when maintenance bills go unpaid and lawns become overgrown. Sometimes, when a board manages the HOA too much, or not enough, problems can arise.
Is an HOA the right choice for you? In the end, it depends on the association and on your personality and living needs. If you don’t like the thought of rules and regulations governing what can do with your home, you might not love an HOA. But if you think you can work with both the pros and cons, it just might be a great fit.