Homeowner Associations (HOA) are often created within single-family houses or multi-unit buildings around the neighbourhood. Normally, homeowner associations are formed to develop and enforce regulations governing the properties underneath their jurisdiction. An HOA is governed by the inhabitants of a neighbourhood. A board of directors is normally chosen to implement and monitor the laws and regulations of an HOA. With all that being said, However, Homeowner Associations also have both advantages and disadvantages which should be thought of.
What are the Pros of the Homeowner Association for Homebuyers?
The following are the Advantages of the Homeowner Association for Homebuyers.
- The HOA assigns lawn maintenance to someone else
- Your neighbourhood will be attractive
- The cost of your maintenance will be split
- You have the opportunity to get to know your neighbours
- You might be able to sell your house for a higher price in the future
- The HOA is a mediator in conflict resolution
1. The HOA assigns lawn maintenance to someone else
One of the advantages for homebuyers is that the homeowner association may dictate what you may and may not put in your yard, as well as what you must have, such as a particular amount of bushes surrounding your property. In certain circumstances, such as some condos, the homeowner association may also provide landscaping services which will be paid for by you.
2. Your neighbourhood will be attractive
A Homeowners Association sets regulations in order to keep the area look attractive. These regulations include tight lawn-mowing requirements, prohibitions on parking big vehicles on the road or street, and lastly, are the limitations when it comes to painting colours of the exteriors.
3. The cost of your maintenance will be split
A portion of the cost of the homeowner associations goes toward the maintenance of common spaces such as walking trails, pools, fitness centres, and other public areas as well as communal lawn care even though it is not for your own lawn and snow removal. Other expenses may include utility expenses.
4. You have the opportunity to get to know your neighbours
Another advantage is that when you get yourself involved in the organization or you are one of the board or just simply attend gatherings set by the association, you will have the opportunity to get to know your neighbours so much better and meet new people as well.
5. You might be able to sell your house for a higher price in the future
One of the advantages is that you might sell your property for a higher price since there is an association that handles and manages the place for it to be better which is one factor to increase selling prices. Most of the things that the association tries to control are factors that we know have an impact on property prices. Even though a homeowner association does not significantly increase property value, it will almost certainly prevent it from dropping by maintaining the neighbourhood clean and well-maintained.
6. The HOA is a mediator in conflict resolution
Another advantage is when you have any concerns, may it be to your own neighbour or something else, HOA is there to listen and with that, you can resolve certain disputes with your neighbours by bringing your complaints to the homeowner association’s board of directors. For example, if there is a neighbour that has a noisy dog or is having a raucous party, the association will notify the neighbour. It is also possible that the homeowner association will enforce a regulation about noise levels after specific hours.
What are the Cons of the Homeowner Association for Homebuyers?
Below are the Disadvantages of the Homeowner Association for Homebuyers.
- You can be impeded by an HOA’s financial difficulties
- There is a risk of lien or foreclosure
- Some of your liberty will be taken away from you
- You might be a victim of a disgruntled board member
- You will have to pay HOA fees
1. You can be impeded by an HOA’s financial difficulties
If the homeowner association is having financial difficulties or is involved in litigation, it may affect your opportunity to acquire a mortgage as well as the selling prices of properties in the neighbourhood.
2. There is a risk of lien or foreclosure
There are fees that you have to pay wherein when you break the rule and are not able to pay, you might be fined and may face the risk of the HOA putting a lien on your own land or property or might lose it to foreclosure if you will not be able to pay the penalties or regular payments.
3. Some of your liberty will be taken away from you
There are owners of the property who does not like to comply with rules and regulations and do not like the feeling of not having freedom in their own place of residence, If you reside in a neighbourhood regulated by a homeowners’ association, you will have to abide by its regulations, even if you believe they are absurd and do not agree with those.
4. You might be a victim of a disgruntled board member
You might encounter a rude or disgruntled board member, if there are things you want to say on how things run, you should have the courage and voice to say so and you must serve on the board. The expense of removing the disgruntled homeowner from the board, including legal fees, was around several thousand dollars.
5. You will have to pay HOA fees
Another disadvantage is that HOA fees must be factored into your budget when purchasing a house in a neighbourhood with a Homeowners association since they keep everything well-maintained and more, they collect fees in return.
Does the HOA require mandatory attendance?
Yes, meetings are important for HOA to know the governing documents, rules and regulations and if there are any changes with regards to the rules. Meetings of the board are necessary to perform the association’s business; the nature and duration of such meetings might vary based on state legislation as well as the association’s documents. Members of the homeowner association are urged to attend as well as participate in said meetings.
How are the HOA rules determined?
The governing papers of a homeowners’ association, as well as any applicable local, state, and federal laws, establish such rules. The governing documents are formed at the establishment of the association, which is normally done by the property developer. The HOA rules are governed by the board of directors once the developer relinquishes ownership of the community. Also, those are the major mechanism for sustaining property values as well as the community spirit which many HOA members enjoy. Both of these elements contribute as well to the HOA’s ability to compete in the real estate market.
Is it possible to change the HOA rules?
Yes, the board frequently has the ability to enact new community regulations. If these rules considerably modify the governing papers, however, a vote of all association members is usually necessary. Moreover, generally, homeowners have the ability to speak with regard to how their neighbourhood is managed. If you do not like a rule, go through the correct means in order for it to be changed.
What happens if the HOA rules are not followed?
Failure to abide by HOA guidelines might result in legal and financial sanctions. Warnings, penalties, as well as other sanctions, may be used as part of an enforcement strategy. If fines are not really paid, the HOA may levy a lien against your property. Most transgressions, on the other hand, are addressed after a pleasant reminder by phone or letter. It is always to your best advantage to follow your community’s laws and regulations. It is a win-win situation for all when neighbours work together in order to improve their association, from improved property prices or value to a stronger feeling of belongingness.
Which one is better, HOA or No HOA?
With all the advantages and disadvantages given, HOA is better in order to increase the property value as well and to keep everything well-maintained. But, it will depend on you if it is okay for you to live in a place with rules or not. If you value amenities and low-maintenance public spaces and don’t have big plans for repairs or house alterations, a homeowner association neighbourhood could be right for you. If you resent having regulations placed on your property or having to get permission to make modifications, the HOA may be more of a hassle for you.