Pros and Cons of HOAs

Pros and Cons of HOAs

Buying a house can get downright expensive! 

Banks charge loan fees, mortgage brokers demand percentages of your loan amount, and title companies bill you for closing costs - and that’s just your up-front costs!

If you buy a house, you also have to pay homeowners insurance and property taxes. If you have a mortgage, you’ll have to add your payments for those to your monthly principal and interest payments. 

On top of all that, some homeowners have to pay neighborhood fees in exchange for the privilege of living in a certain community. 

Some home buyers believe that paying HOA fees is worth every penny. Others don’t.

We at eHome America want to help you make up your own mind, so we’re going to give you some pros and cons of HOAs.

What is an HOA?

Homeowner Associations (HOAs) are organizations established to govern real estate communities, subdivisions, or neighborhoods. HOAs make and enforce rules for residents and their properties in order to maintain the community’s aesthetic appeal and property values. 

Membership in an HOA is usually required for those wishing to buy a home within the jurisdiction. Payment of monthly, quarterly, or annual HOA fees is also expected (and usually legally required) of residents. 

Typically, an HOA is run by an unpaid board of directors elected from among its residents, and since most HOA are incorporated entities, board members must meet regularly. 

What do HOAs do?

During meetings, HOA boards might create new regulations, review member complaints and suggestions, determine appropriate disciplinary actions for non-compliant residents, or schedule community events.

HOAs must also appropriate use of monies accrued from HOA dues. Boards tend to put fees collected toward maintenance and improvements of common areas like pools, club houses, tennis courts, playgrounds, walkways, greenways, and sidewalks. 

Depending on board members’ personalities and their desired levels of involvement, an association’s rules and regulations and their enforcements of those guidelines can be fairly laissez faire or somewhat tyrannical in nature. 

HOAs often place restrictions on residents’ structures like the type of fencing they can put up, the type landscaping features they are allowed to use, or the number and types of vehicles they can park in their driveways. 

However, some HOA boards try to control almost every choice residents make about their properties. For instance, they may require homeowners to paint their houses pre-approved colors, to use specific plants in their landscaping designs, or to mow their lawns every 4 days.

Pros and Cons of HOAs

Like most things in life, there are pros and cons to Homeowner Associations. Here are a few we hear mentioned most often:

Pros:

• Guidelines they create typically preserve or improve community property values.
• HOA rules often require residents to maintain property aesthetics such as cleanliness, maintenance, and improvements. 
• They provide services that maintain common areas and facilities. 
• They usually provide residents access to amenities such as swimming pools, golf courses, playgrounds, greenways, and more.
• Some HOAs also mow residents’ lawns or handle their garbage pick-ups.
• Boards often settle disputes among residents.

Cons:

• Some HOAs create nit-picky guidelines to exercise control over residents.
• HOA boards have the authority to fine residents for non-compliance.
• Some HOA fees seem to be extremely high.
• HOAs can place liens against properties if their residents don’t pay their dues.

Depending on what matters most to home buyers, HOAs will either be appealing or unappealing. 

Whether you have the choice to join your HOA or not, it’s important to know how they operate!