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How To Live With A Homeowner’s Association

Homeowner’s associations have gotten a bad reputation. Everyone has heard a HOA horror story. Most Associations, however, are reasonably well-run and do a good job of what they were created to do—keep the property maintained to protect the value of the owner’s homes. But living in even a well-run HOA is not for everyone. The restrictive covenants designed to protect property values also restrict an owner’s individuality and freedom. In order to peacefully co-exist with a HOA, you need to understand what you are signing up for and how it all works. Ideally, your investigation should take place before a purchase contract is signed. Here are a few rules that can help.

  1. You must know what the rules are. Fortunately, this is easy to learn. A HOA will have its rules in writing in the form of Covenants, Conditions and Restrictions (CC&R’s) that are recorded. They are public record materials and are readily available. Read them carefully and make sure that you can live with the limitations they contain. Your purchase of a home in the HOA is your agreement that all of these restrictions are binding upon you.
  2. You must know how the rules are being enforced. Sensibly? Or with a heavy hand. Check the records of the Superior Court to see how many lawsuits have been filed by or against the HOA. Talk to homeowners to get their personal experiences. How a board of directors or management company goes about its business can make a huge difference in homeowner satisfaction.
  3. You need to know if the homeowners are actively involved in the community. The best run HOA’s have a broad base of homeowner involvement and support. Again, speaking with owners will be helpful. And when speaking with homeowners, ask if there are a lot of rentals in the development. A large percentage of rentals can be a negative.
  4. Look at the books. A HOA has many responsibilities as set forth in its CC&R’s. It has to have the funds to accomplish them. A well run HOA will budget responsibly and will maintain reserves for the large cost items that it must periodically handle. A poorly run HOA will have no option but to levy large assessments against the owners whenever major items need to be repaired or replaced.
  5. Finally, should you decide to purchase into a HOA, be active in the life of the Association and become known. Run for the board of directors or serve upon a standing committee. Getting to know your neighbors and being an insider are great ways to maximize your ownership experience.