A homeowners' association, or HOA, is an organization in a housing community that makes and enforces rules about the appearance and maintenance of properties. They also maintain the common areas (clubhouses, tennis courts, community pool, etc.) to ensure the property values, with money from membership fees. Almost all HOAs will also have liability insurance in case they get sued, too.
Nearly all private neighborhoods and gated communities have a homeowner association and an HOA board. Of course, many apartment complexes have HOAs, as well. Here is what you need to know about homeowners associations.
The simple answer is no.
However, anyone who purchases or leases an apartment that is part of an HOA will be required to pay the monthly HOA fees to remain a part of the HOA. Usually, you can't choose whether or not you want to be a part of the HOA because if the apartment is already a part of the HOA, its tenant must be, as well. You should keep this in mind before signing a lease for an apartment with a homeowners association.
As mentioned above, once you sign your lease you will automatically become a member of your apartment's homeowner's association. Homeowner associations are typically run by other volunteer homeowners and have a board of directors that has been voted in by the property owners. As a property owner and HOA member, you will now be invited to take part in this as well as pay HOA fees yourself.
Most HOA board members' job is to oversee the HOA's financial situation, maintain the property value and enforce rules and regulations among residents. They also make sure to protect property values daily.
If you live in a large apartment or home complex, then you and the other homeowner association members might be asked by the board members to help maintain the common areas to keep up the property values. Usually, your homeowner's association rules will be outlined in the conditions and restrictions of the covenant.
If the community doesn't want to run the HOA they can also bring in an HOA management company and an HOA manager to run the homeowners association. This company would then act as the board in enforcing rules and taking in HOA dues.
In some other cases, a real estate developer will do the management services and act as the HOA management company. Make sure you read these before deciding on living in an HOA.
If you live in a place with a homeowners' association, you will owe monthly or annual fees. The amount of your HOA fee differs depending on a few factors such as amenities or the number of properties within the complex. Association fees can range anywhere from $100 to $1,000 per month. You would be required to pay HOA fees as long as you lived in the apartment or home. HOA costs are important to keep in mind as they will be an expense on top of your monthly mortgage payment.
The HOA fees cover and contribute to the association's reserve fund. This reserve fund is meant for unexpected expenses, operating expenses, repairs, projects or emergencies. Your HOA board members are typically in charge of collecting the HOA fees when they are due and using the fund services accordingly.
Along with having to pay fees, if you have unpaid dues or don't comply with community rules, you could be subject to a fine and will have to settle your unpaid assessments.
Every HOA comes with its own set of HOA rules that cover a vast range of homeowners' rights. When you sign into an HOA it is a legally binding document, so make sure you read all the community's bylaws and the HOA's bylaws before signing as you can be fined for breaking any rules and regulations.
Common HOA rules can include anything from the height of your fence to your landscaping and even decor on the outside of your property. HOA rules can also include pets, how many people can live in your apartment or home and if you can rent out your property.
While HOAs have the legal authority to enforce rules it's important to keep in mind that all HOAs have to comply with state laws and the Fair Housing Act. Special assessments often depend on state laws and the HOA board of directors bylaws.
You now know that stands for homeowners' association but what is a property owner association? The main difference is that just by living in an HOA you are a member. In a property owners association, community members can join even if they are not homeowners.
With anything in life, there are pros and cons. These are some of the pros and cons of living in an HOA-run community.
These are some cons to living in HOA neighborhoods.
Now you know what HOA stands for and the HOA meaning you can make an educated decision before buying or renting a new place. Talk to your real estate agent so that they really know what type of community you are looking for. HOA living is not for everyone and that's OK!
If the idea of living in the HOA community sounds like something you'd be interested in then just make sure to do your research. And as always, weigh the pros with the cons and decide the type of apartment you want to live in. If you think you'd enjoy having a clubhouse or a gym or a guard gate, then maybe the fees are worth it to you.