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Things you need to know about HOAs
If you’re new to owning a home or are currently in the market, some neighborhoods have what’s called a Homeowners Association or HOA. Not all housing divisions have this but we want you to be aware of what it means for you and your home.
Moving into a neighborhood with an HOA typically means that it is well maintained and that your property value will increase over time. This isn’t a guaranteed but can happen if the HOA works well to keep certain standards in the neighborhood. Homeowners Associations are made up of local, elected residents who are responsible for enforcing rules and regulations within a gated community or neighborhood. They oversee the aesthetics in community areas and home maintenance. Regularly scheduled meetings are held for homeowners to bring up issues needing to be addressed and for board members to discuss major decisions for the community. An HOA is also a great way to decrease neighbor to neighbor conflict if an issue happens to arise.
Home upkeep tends to be the main focus of an HOA. Keeping the neighborhood within regulation helps keep home values high and the community happy. Neighborhood regulations make sure that homes are not painted “wild colors” and lawns are kept green and trimmed, among other things. Many times, in order to make changes or updates to a home, homeowners must first contact the board to make sure the changes are within regulation. Rules or Common Restrictive Covenants, CRCs, vary by association. However, there are some common rules seen within various HOAs. Some examples include:
- Allowable exterior home colors
- Minimum landscaping standards
- Allowable window treatments
- Outdoor lighting
- Vehicle storage or parking
- Additions to your property
- Noise restrictions
So don’t paint the exterior of your home a bright, sunflower yellow without bringing your change to the HOA for approval first. Otherwise, you could run into issues with the board members, other neighbors, or be reprimanded for not following the CRCs of the community.
In order to keep a certain aesthetic in the community, funds are collected by the HOA that will help maintain the grounds in common areas. Fees vary based on the size of the community and the number of amenities to be maintained. Areas maintained by the HOA include sidewalks, pools, lighting, or any other facilities that can be used by residents. These fees are accrued monthly, quarterly or yearly, depending on the neighborhood, and may go up over time. Fees cannot be adjusted for each individual household and are determined by the HOA based on the needs of the community. Additional fees may be collected, when needed, if there are no reserve funds or reserve funds have already been used and a major community update needs to be made. This is more likely to happen after a natural disaster when neighborhood damage is high.
Make sure you find out what your new neighborhood expects. Typical questions include:
- How often are fees collected?
- What will my fees be covering?
- Does this neighborhood have a reserve fund in case of emergencies?
- How much are the fees and how often do they increase?
- What are the neighborhood rules?
- What happens if the rules aren’t followed?
- How are the rules determined?
These should all be asked before you move into your new home. This way you know what is expected of you and what you can expect of your HOA and whether or not you can abide by the rules.
-The Smith Team