When setting up property search parameters for our buyers on the MLS (Arizona’s Real Estate Listing Service), we are sometimes asked to filter out HOAs (Home Owner Associations). Conversely, every once in a while we’re also asked to make sure that the property includes an HOA. Virtually every time when requested, it’s due to the prior negative experience of the buyer.
I’ve experienced both sides personally and professionally. And you know what? Even though folks feel strongly about HOAs one way or another, they’re not right or wrong — it’s simply a choice that each of us has. The most important thing is to know what you’re getting into and the potential downside.
This week we’ll cover the benefits of an HOA. Next week, we’ll look at the drawbacks. And finally, in the last installment I’ll cover what a buyer should know about the HOA from the perspective of the purchase contract. Just knowing what you’re agreeing to in a purchase contract can save or cost you hundreds of dollars
Benefits of an HOA!
As I see it, the benefits on an HOA are many. Homeowners within a given community pool their funds to pay for a few or many amenities, privileges or restrictions. The minimum responsibility that I’ve seen in an HOA community is for rules enforcement only. Typically the cost of this limited type HOA is $30 to $40 per month.
If for example, your next door neighbor (whether owner or renters) does not maintain their home, doesn’t maintain the lawn or weeds, or leaves a jacked up car in the driveway – all the time, then there is a process to get that taken care of. In some communities, hired HOA staff actually drive the neighborhood daily to look for these rule violations. I’ve heard the term “Gestapo Tactics” when related to this type of oversight. Strict enforcement may be a pain in the you-know-what, but guess what? That community is probably kept pristine. For many, there’s nothing more frustrating than having visual blight in the neighborhood that you see day after day.
The next minimum step up in HOA services and fees is for “common Area Maintenance.” This is where the HOA keeps up with the appearance of the neighborhood by cutting front lawns, keeping trees trimmed and trash picked up.
I can tell you from a buyer perspective when driving through “the hood,” that if there are unsightly yards or houses, or too numerous vehicles around, that is often a turn off, or more appropriately, a turnaround, where I turnaround the car and head to the next home. Just having these community rules alone can be very valuable.
Townhouse/Condo HOA’s are especially important because of the close proximity that people live near each other. Often these HOA’s are more costly because they may also include a monthly water, sewer, trash fee and cable charged by the association besides the maintenance of the community pool and the community gate or guard gate. Yes, you will pay for someone to keep the pool and spa clean and heated in winter even though you don’t use it, but many folks enjoy the fact that they have access to these amenities year round and don’t have to pay for it on their own property.
Don’t like the way the community is being run? Well, you can make your voice heard at a monthly HOA meeting, and you can even run for a position on the HOA board. Warning though, this is not for the faint of heart.
– Mike Bodeen