If you’re trying to purchase a home, you’ll probably come across several homes managed by homeowners associations, or HOAs for short. Homeowner associations (HOAs) make up an essential component in many residential areas. Well-managed ones aim to preserve and improve property values, promote community safety, and manage common facilities.
However, despite their obvious benefits, HOAs battle with disturbing stories of mismanaged finances and strict rule enforcement. Such stories certainly contribute to unfavorable perceptions of HOAs. Continue reading below, as this article can help you understand smart solutions that help debunk these misconceptions about HOAs.
Why Do HOAs Receive a Negative Reputation?
You’ve probably heard complaints about outrageous fines, rigid rules, and power-hungry board members. But why do HOAs have such a bad reputation?
Imagine finally getting to your dream house only to be informed that you cannot park your car in your driveway overnight or paint your front door the desired color. These seemingly minor rules can feel restrictive and frustrating, leading many homeowners to believe that the HOA management is restricting their personal freedom.
Another concern is the HOA fees. HOA dues are collected to maintain common areas and enforce rules, but when they suddenly rise or appear improperly handled, homeowners wonder where their money is going. For further clarification, you can discuss these concerns with a Philadelphia HOA management company about the required fees.
Some HOAs enforcing some laws can feel inconsistent or, worse, unfair. Some HOAs strictly penalize minor infractions while blinding them to bigger issues. Others have board members who take their roles too seriously, making life difficult for residents instead of improving the community. Not all HOAs are bad, as there are still other managements that can genuinely enhance property values and community living. However, when power struggles, financial concerns, and rigid rules collide, it’s no surprise that HOAs often get a bad reputation.
How Can Property Management Resolve HOA Concerns?
Act as a Liason Between Investors and HOA
In addition to providing property management services to homeowners associations (HOAs), they ensure that communication between investors and HOAs is smooth and that the communities comply with regulations. They assist in resolving disputes as the go-between for homeowners and the HOA board. They act on behalf of investors as they navigate HOA regulations, go to meetings, and provide opinions about matters including repairs and maintenance, fees and dues, and rules and regulations.
They understand HOA bylaws and local ordinances to guide investors through the tricky association rules and regulations, which help keep investors out of disputes with the HOA or avoid possible fines. Their expertise also allows properties owned by investors to stay in good standing and adhere to community standards. In addition, property managers act as intermediaries to settle disputes and manage day-to-day operations between investors and the HOA board and managers.
Property managers ensure investors make timely payments of HOA dues and fees, plan maintenance requests, and do so while informing investors about policies, new developments, and enhancements. In this situation, though, one thing to note about the difference between HOA managers and property managers is the fees that they charge.
All of this helps reduce the responsibility and burden for an investor while focusing on making a profit and being a good teammate to the HOA. Overall, property managers serve every purpose of protecting an investor’s assets while ensuring the investor’s investment contributes positively to the community and the interests are balanced between the investor, the property manager, and the HOA.
Transparency in Managing Finances
A solid financial plan is essential for an HOA to operate successfully. The board must draft a thorough budget that breaks down revenue and costs, accounts for recurring evaluations, and sets aside money for upcoming maintenance and upgrades. Without effective budgeting, managing a successful HOA and preserving property values are impossible.
In the long run, even minor budgetary errors can cause significant disputes between residents and HOA board members. Having an inefficient fee or assessment collection mechanism, failing to fully finance the reserve fund, failing to account for inflation rates, and failing to incorporate existing bad debts and unpaid dues in budget projections are all examples of common budgeting errors made by HOA boards.
Property management is a good option if you need assistance putting your community back on track or just want to make creating and modifying your HOA budget less stressful. Property management will assist your board in reviewing vendor contracts, figuring out cost increases, examining financial accounts, and determining homeowner dues for the following year. A management business would save your HOA time and money in the short term, but budgeting is never simple.
Final Thoughts
Living in a homeowner’s association (HOA) has benefits and drawbacks, but the choice mostly depends on individual preferences and the type of HOA. Some HOAs are more stringent than others, and those with more amenities, services, and rules may also have higher dues, though this varies by association.
In these cases, property management is very beneficial. It helps bridge the gap between HOAs, homeowners, and investors. At the same time, it assists HOAs in resolving problems like bad budgeting, a lack of communication, and a failure to enforce rules and regulations. Professional property management will assist your board in reviewing vendor contracts, estimating cost increases, reviewing financial documents, and determining homeowner fees for the following year.
