Homeowners’ associations can be what draws buyers to a new home, or what drives them away. An HOA may help sustain higher standards for a neighborhood’s appearance but homeowners’ associations often come with high costs, strict rules, and rigid regulations. Before buying a property that’s subject to the regulations of an HOA, it’s important to evaluate the pros and cons to determine whether it’s an ideal option.
There Are Benefits and Downsides to Buying an HOA Property
- Improved Community Appearance
HOAs generally have rules to prevent property neglect. Every home within the HOA is required to meet certain standards or face a fine. Therefore, garishly painted houses and unkempt lawns are unlikely scenes in an HOA community.
- Reduced Responsibilities
Many HOAs provide maintenance services such as trash and snow removal. The fees homeowners pay to their HOAs typically go toward those services.
- Access to Recreational Amenities
Many HOAs give homeowners access to a range of recreational amenities that they may not otherwise be able to afford. These amenities include playing fields, sports courts, walking trails, community centers, tennis courts, gyms, and swimming pools.
- Systematic Dispute Handling
Management often handles problems that arise within the community. If one homeowner has an issue with another homeowner and his unkempt lawn or other property issues, he can ask the HOA to intervene instead of taking matters into his own hands. This helps reduce friction and conflicts among homeowners.
- Risk of Foreclosure
Homeowners are required to pay an annual, quarterly or monthly fee that covers the maintenance and management of the community. If a homebuyer gets behind on his fees, the HOA might foreclose on his home.
- Restrictive Rules
Homeowners are not at liberty to do what they want with their property when it is managed by an HOA. While homeowners can call for rule changes, there’s no guarantee that their requests will be granted. A real estate lawyer can unearth rules that might put homeowners at a disadvantage.
HOAs have grown tremendously in popularity during the past few decades. This suggests that people are willing (and able) to pay for extra amenities, services, and generally, more control over their local neighborhoods.