When you purchase a home in a community governed by a homeowners association (HOA), you will automatically become a member. This means you'll be required to pay quarterly or monthly fees as the property owner. However, not all homebuyers know what HOAs are, how they function, and the fees associated with them.
If you're planning on buying a home soon, we made a quick guide on HOAs.
What Is a Homeowner Association (HOA)?
A Homeowner Association (HOA) is an organization formed by a community of homeowners to manage and maintain common areas and amenities within a residential development. These associations play a crucial role in maintaining the overall appearance, value, and quality of life in a community.
An HOA usually has a board of directors or governors who oversee and enforce their rules and regulations. Some of these regulations can include structural restrictions, such as the type of fences or building materials allowed. It may also include minor, aesthetic-related regulations such as the color of paint on a house.
What Are the Functions of Homeowner Associations (HOAs)?
Homeowner Associations are responsible for a range of functions aimed at preserving the community's aesthetics and enhancing the quality of life for its residents. Some common functions include:
Property Maintenance: HOAs enforce guidelines to ensure that properties within the community meet certain standards, maintaining a cohesive appearance and protecting property values.
Common Area Management: HOAs oversee the maintenance and improvement of shared spaces such as parks, recreational facilities, and landscaping.
Rule Enforcement: HOAs establish and enforce community rules and regulations to maintain a harmonious living environment. This may include guidelines on exterior home modifications, noise levels, and parking restrictions.
Budgeting and Finances: Homeowner Associations create and manage budgets to cover maintenance costs, repairs, and other community expenses. They collect fees from homeowners to fund these activities.
What Are Common Homeowner Association (HOA) Fees?
Homeowner Association fees, often referred to as assessments, are recurring charges collected from homeowners to cover the costs of maintaining and managing the community. Common types of fees include:
Regular Assessments: Monthly or annual fees covering routine maintenance, landscaping, and basic services.
Special Assessments: Occasional charges levied to fund unexpected expenses or major projects, such as roof repairs or infrastructure upgrades.
Initiation Fees: One-time fees charged when a homeowner first joins the community or purchases a property.
Late Fees: Penalties imposed on homeowners who fail to pay their assessments on time.
HOA fees can range anywhere between $100 and $1,000 a month. The fee may increase based on the number of services and amenities included in the community.
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