What Is an HOA and Why Does It Matter?
Homeowners Associations (HOAs) are organizations that manage and maintain shared spaces and standards within planned communities, condominiums, and townhomes. While HOAs sometimes get a bad reputation, they play a vital role in preserving property values, fostering community engagement, and ensuring neighborhoods run smoothly.
Why Do HOAs Exist?
HOAs are typically established by real estate developers to maintain the integrity and value of a community. Once formed, they oversee operations, enforce rules, and manage shared amenities.
Who’s Involved in an HOA?
• Board Members: Elected residents who enforce rules, manage budgets, and oversee community operations.
• HOA Members: Homeowners within the community who pay dues and follow the HOA’s guidelines.
What is a Declaration of Covenants, Conditions and Restrictions?
These Declaration of Covenants, CC&Rs typically include bylaws and regulations regarding the appearance of the exterior of the homes including fencing, landscaping, roofing and paint color. Noncompliant homeowners are also held accountable to keeping within CC&Rs standards through citations and fines.
Learn More: HOA Bylaws 101: Rules, Roles, and How They Work
Let’s Get the Facts
According to the Homeowners Association of America, there are“over 351,000 homeowner associations in the United States. Collectively, this represents over 40 million households or 53% of the owner occupied households in America.” Furthermore, over 70% of these homeowner associations consist of volunteer members that manage the organization by the Board of Directors. As rural new developments begin to arise, it has been estimated that as many as 8,000 new Homeowner Associations are created yearly.
Benefits of Living in an HOA Community
• Increased Property Value: HOAs maintain standards and amenities that enhance home values.
• Shared Amenities: Pools, clubhouses, parks, and more are often managed by the HOA.
• Community Events: HOAs may host social gatherings, parades, and holiday celebrations.
• Dispute Resolution: HOAs help mediate neighbor conflicts.
• Clean & Uniform Appearance: Rules ensure homes and common areas are well-maintained.
Common HOA Rules
While rules vary, most HOAs enforce guidelines such as:
• Proper trash disposal
• Lawn maintenance
• Exterior paint color restrictions
• Pet policies
• Recreational vehicle parking
• Building specifications
HOA Types & Living Arrangements
• Condominiums: Owners typically control the interior; the HOA manages exteriors and shared spaces.
• Townhomes: Owners may have more control over exteriors but still follow HOA rules.
• Single-Family Homes: Often found in gated communities with amenities and lower monthly fees.
HOA Fees Explained
• Average Cost: $200–$400/month, depending on location and amenities.
• Assessment Fees: Charged for unexpected expenses like natural disasters.
• Mandatory Payments: Required by law and considered in mortgage applications.
• Renters: May pay fees directly or through landlords, depending on lease agreements.
Can HOAs Raise Dues?
Yes. Dues may increase due to inflation, maintenance needs, or new projects. All changes must follow CC&R guidelines.
What Do HOA Fees Cover?
Fees typically fund:
• Maintenance of shared spaces
• Landscaping
• Trash removal
• Community events
• Security services
HOA Laws You Should Know
Federal laws impacting HOAs include:
• ADA: Protects disabled persons in public accommodations.
• Fair Housing Act: Prevents discrimination in housing.
• Fair Debt Collection Practices Act: Regulates debt collection.
• Flag Act & Antenna Rules: Protect rights to display flags and install reception devices.
• Bankruptcy Code & Service members Civil Relief Act: Protects homeowners in financial hardship or military service.
View HOA laws by state here
How Does an HOA Management Work?
- What Is An HOA Management Company? An HOA management company is a third-party firm that helps cover a larger scope of responsibilities, when it becomes overwhelming for the elected volunteers of a HOA Board of Directors. HOA management companies oversee many HOAs at a time and act in as a primary consultative role to aid in a long-term success of HOA organizations.
- HOA Board of Directors: The Board of Directors consists of primarily all volunteer HOA members that perform their duties on a volunteer basis. These members are mainly responsible for overseeing functions such as maintaining common areas and amenities within their community. They may also provide a shared service such as organizing a trash collection or recycling drive. HOAs also make community decisions, create and adopt policies, along with hiring vendors when needed.
- HOA Management: An HOA management company guides and consults with the Board of Directors to fulfill their duties with areas such as helping make executive decisions, documenting transactions and keeping accounting records when needed. They may also work as a point of contact for members when having to work with larger projects and responsibilities. For example: The HOA Board of Directors may be in charge of making decisions while the HOA management company will be responsible for fulfilling dues, maintenance and vendor payments based on those decisions.
What Roles Come With An HOA Management Company?
- Accounts Receivable: Here is where the management company will be in charge of billing, reporting delinquent accounts, sending delinquent notices, collecting funds and working with the association’s attorney when coordinating legal actions.
- Administrative Services: Main responsibilities include scheduling board meetings, providing monthly reports, enforcing rules and regulations, guiding the board through preparing an annual budget and responding to homeowner inquiries.
- Accounting Services: Main responsibilities include managing bank accounts for the community, estimating maintenance costs, record keeping on all accounts payable and accounts receivable, creating monthly financial statements and providing guidance for long-term funding.
- Site Management: Main responsibilities include inspecting rule violations, coordinating various board-approved actions, checking maintenance issues and checking for all lawn care, pool cleaning and other vendor tasks are completed and kept up to all standards according to the guidelines outlined by the HOA Board of Directors.
HOA Software
With the many tasks and responsibilities that come with managing an HOA, some communities may consider finding easier ways to help function their day-to-day routines and responsibilities. As a solution, incorporating an HOA software can be a great substitute to an HOA managers toolbox; providing an easy-to-use system to help streamline administrative work such as CC&Rs, policies, accounting, communicating and much more.
What Are The Benefits of An HOA Software?
Investing in an HOA software can not only ease difficult-to-manage tasks, but it can also be an added amenity for the community – making the HOA experience digital and seamless.
- Utilizing an HOA software provides a professional touch to any HOA organization. Acting in a consultative role, HOA software features include support lines to help connect, collaborate, advise, and manage their communities.
- HOA software features solve major pain points for neighborhoods.
- Administration: HOA software can help manage routine and requested maintenance. They may also provide easy access to documents and integrate with accounting systems that allow HOA members to make online payments, check balances, and make communal space reservations.
- Communication: Other responsibilities related to communication may include managing package deliveries and notifications for their members, maintaining safety procedures, creating and maintaining an approved list of authorized visitors, maintaining the HOAs website with current updates, and sending push notifications to neighbors and residents with any new HOA news.
- Community: HOA software can help to easily connect the community through event calendars and reminders, polling to help make decisions without hosting a formal meeting, keeping a private network of listings and classifieds, hosting forum threads, along with direct messaging capabilities between the Board of Directors and residents.
The More HOAs Rise In Numbers, The More Demand For Effective HOAs Will Rise.
As HOA communities continue to rise in number by almost 8,000 a year, the likelihood of a seeking homeowner being affiliated with an HOA is fairly high. Homeowners seek security, a good place to raise their families and most importantly a good quality of living. In conclusion, the better an HOA is run and organized, the more quality of service and value a community brings to its members. According to a study conducted by Wyatt Clarke and Matthew Freedman it was concluded that “that single-family houses with an HOA generally sell at a premium, but with substantial local variation. On average, buyers pay at least 4 percent, or $13,500, extra for a house that is subject to an HOA.” Like many home buyers, it is important to feel secure with the decision to invest extra dollars into their home. With that comes one primary benefit ‒ to have an effective HOA community.
Why Invest Into An HOA Software?
Most commonly many HOA organizations can run into issues due to the lack of communication and involvement that their members may encounter. As a result, this can lead to poor member expectations and engagement. HOA members may miss out on the benefits of a tight-knit community and are known to be less likely to speak up about their concerns. By allowing an HOA software to help relieve the stress of issues like these, will not only bring a stronger quality of living, but more value to the community.
- Effective communication: An HOA software allows its members to communicate more effectively to one another. For example, using polls and forums enables communities to engage in virtual discussions of day-to-day matters, along with events and other important gatherings.
- Reduces Costs: HOA softwares can help reduce costs from mailing or printing expenses that can easily be posted and updated through a virtual discussion or direct message. Another major perk that some HOA softwares can bring is by allowing its members to customize their own website through their own chosen application. This alone can save thousands of dollars on the organization and allow the HOA to put more personalization into their view as a community.
- Reduce Time: Time is money. An HOA software can also help reduce the time it may take for a volunteer to manually implement. For example, an HOA board member that volunteers their time to help manage dues may end up taking more than 20 hours of their week, plus having to work a full-time job. HOA softwares can easily manage and process its members dues by a few simple clicks. As a result, payments are properly processed, less time is spent on processing and most importantly, members have a sense of security knowing that their HOA fees will be properly processed and recorded without errors.
.png)
.png)
.png)
