Ever wondered what it means to have a homeowners association in your neighborhood? Here are a few easy facts to help you out!
What is an HOA?
HOA stands for Homeowners Association, and its organizational purpose is to make and enforce rules within the community of properties, whether it be houses or condominiums/apartments.
What does an HOA do?
Typically, an HOA enforces architectural guidelines, maintains common areas and amenities (such as a swimming pool, tennis court, playground, gyms, etc), and prohibits or authorizes particular activities, uses and improvements of certain residential developments. The HOA is run and funded by residents of the neighborhood, but its overall goal is to increase property values.
Does it cost money?
Depending on your community, HOA members are required to pay fees, whether it be monthly, quarterly or annually. Some HOA’s fees are $10/month, whereas some fees might be well over $1000/month – it all depends on your community’s location, size, and overall value.
What does the HOA pay for?
The fees you pay every month are generally used to go towards maintenance of common areas/amenities, or even security to ensure that your neighborhood is safe during all hours of.
How does it affect my house when selling?
HOA’s can be quite beneficial, even though their rules may seem a bit restrictive. Your property can go up in value because of these rules that keep the neighborhood in tip-top shape. These rules ensure that no couches will be displayed in the front yard, no house will be painted some exotic color or that no rusty car will be parked on a lawn.
Not Every Neighborhood Has an HOA
HOAs are more commonly found in planned or gated communities, so not every house or neighborhood is bound to an HOA!
“I’m moving into a neighborhood with an HOA, should I be worried?”
If you are moving from a neighborhood without an HOA into a neighborhood WITH an HOA, make sure you know the covenants, conditions and restrictions (a.k.a “CC&R”s) that you would have to follow upon your move-in.
Can an HOA legally enforce their rules?
Yes! By buying, owning and living in a house in an HOA community, you are legally bound to pay the HOA dues that are charged. Refusal to pay these dues can result in a fine from the HOA itself, or the HOA can place a lien (legal right against assets) on your property. Make sure you read the fine print of your next real estate contract to see if you have any concerns!