Many home buyers find they are locked into Home Owners Associations as part of their purchase. This is most common with the purchase of a condominium, gated community, townhome, and more frequently in general subdivisions. A Home Owners Association is in charge of overseeing the collection of fees for the upkeep of common areas such as landscaping around signs that name the community and similar areas.
There are things every buyer should know before purchasing a property that is part of an HOA. For example, these fees are collected monthly and generally increase with time - not decrease. The more upscale a community the higher the fees are likely to be. And these fees often do not cover major expenses such as the addition of a new roof - that can be an added assessment that might end up costing the homeowner thousands of dollars in unexpected fees.
In the case of HOAs, everyone who lives there and shares common areas are commonly responsible for such things as the pool, security, and more - even if you or your family do not make use of everything yourself.
Also, there are rules and regulations that govern common areas. For example, one condominium association does not allow for flags to be hung on the outside of the dwelling. This has caused problems for one Florida homeowner who is a retired vet and wants to fly the American flag.
The association refuses to make an exception because - well, then the precedent is set for making exceptions in general! But that is not all. The HOA often decides all of the details of the exterior including the color you are allowed to paint or the type of door you may install!
If the real estate agent tells you that the home or condominium you are interested in is part of a HOA and you are partial to the property be sure to do your homework. Educate yourself on the rules of the association to ensure they are something you can live with long term. That is - if you want to fly a flag make sure you are permitted! Also be sure your property is not out of compliance and in a position where fines have accumulated for violations.
Lastly, those fees are important. Get a history of the fee schedule and rate increases for as far back as ten years if possible. Also, get a detailed explanation of where those fees have been spent, how much is in reserve, what the fees cover and don't cover, and any upcoming major improvements expected in the next 2 to 5 years.
The more you know - the happier home owner you will be. Let us help. Visit our website for more information on this and related subjects.