What is an HOA?
How does an HOA work?
5 Crucial Things to Know Before Buying a Home in a Neighborhood With an HOA
The rules and regulations, often referred to as the CC&Rs, often cover all kinds of community standards and violations. Request copies of these documents and read through them carefully ahead of time. It will help you become familiar with the rules concerning the following:
Pet regulations - There may be limitations on the type of pets, breed, size, and how many pets or animals you can have. You might be looking for a house with a huge backyard where you can raise chickens or bees, for example, but your HOA might have some restrictions when it comes to any backyard farming.
Parking - Be mindful of any rules regarding parking overnight on the street, leaving your garage door open for an extended period of time, or parking for any commercial vehicles and RVs or trailers.
Property modifications - Some changes you might want to make may require approval from the board and/or your neighbors. Likewise, some property additions might not be allowed at all.
Leasing or renting restrictions - You may need to get permission from the HOA board to be able to rent the home. Or you may be required to join a waitlist if there are already too many homes in the neighborhood that are being rented. This is crucial if you want to use your home as a future investment property.
Yard work and maintenance
Fencing height and placement
Exterior paint colors and other design choices
Use of shared amenities and common areas (pools, parks, community centers, basketball courts, etc.)
By being aware of exactly how much these dues are and how often you need to pay them, you can calculate them into your total monthly costs. You can then determine whether the HOA fees align with your financial capabilities and expectations.
Furthermore, you should also review the HOA’s financial statements and keep an eye out for the association’s financial health. These documents provide insights into the association’s income, expenses, and reserves. You’d want to ensure that the HOA has a well-maintained reserve fund that can be used to handle unexpected expenses, such as repairs and emergencies.
It’s also a good idea to review the minutes of recent HOA board meetings to become familiar with the issues they’re discussing, including any planned assessments, common homeowner requests, and the timeline for completion of small and large projects.
HOA fees also vary depending on the range of amenities and services that the community offers. When considering a home within an HOA, check what amenities are available and how they could affect your membership. Is there a community pool? Do they have playgrounds for kids? Are there basketball or tennis courts? These extras can be beneficial to your daily life and help cultivate a vibrant sense of community.
In addition to amenities, don’t forget to check the scope of services provided by the association. These may include tasks such as landscaping, trash collection, snow removal, security, and other maintenance and repair duties.
Every community's HOA works differently. Typically, people within the community elect the members that they believe will best represent community interests, making up the board of directors or a similar governing body. But some HOAs are professionally run.
If the association in the community you’re interested in is being managed professionally by a private company, you might want to investigate its reputation. You might want to avoid investing in a property in a community whose HOA is involved in frequent drama and petty politics.
Understand that HOAs are legal entities and that they have the legal right to enforce rules and issue punishments for rule-breakers. Before settling in a particular neighborhood governed by an HOA, explore how rules are set and enforced, what penalties are in place for not following them, and the process for resolving disputes.