Homeowner Associations are essentially a governing structure for a planned community. Often representing a development of single-family homes, condominiums, or townhouses. Similar to a landlord or property manager, an HOA operates as an entity that maintains the community by taking care of certain features in exchange for a monthly or annual fee. In 2018, ¼ of the U.S. population lived under some type of community association, spread among over 347,000 associations nationwide. Homeowners Associations govern 33% of homes in the Northeast. Although every association is fundamentally different, living in an HOA community comes with many benefits as well as many conditions and stipulations that residents can find relatively burdensome. HOAs can be efficient and professional or can mismanage the community and misspend money. The simple fact is that there are advantages and disadvantages that come with every homeowner association.

HOA costs vary, one cost frequently included in the fees they collect are utilities. The association often take responsibility for basic water and gas as well as city services such as sewer, trash, and recycling, effectively cutting down on the number of bills their residents have to pay each month. The most obvious draw of some HOAs fees is that they include amenities like swimming pools, tennis courts, golf courses, playgrounds and gyms in their communities – Which are entirely maintained and serviced by the community association. Although the scope of amenities will add to the overall association fees, on average, each dollar and dues buys $1.19 in benefits.

Association Fees are mandatory and can get expensive, depending on the community and what the fees include. On average, associations incur $2,800 in fees, annually. Most monthly assessments are about $100 to $300, in addition to maintenance and upkeep, these fees pay for employees who work for the HOA, as well as money for a reserve fund, typically for unexpected expenses and emergencies. HOA fees are an additional cost on top of a resident’s mortgage, property tax, and homeowner insurance, and members are required to pay, even if they don’t use all of the amenities. HOA fees can affect a prospective homeowner’s budget to buy a house in an HOA  community and can ultimately lessen their buying power.

One of the most common benefits provided by HOAs is that they handle a majority of the exterior upkeep in the community, ensuring residents don’t have to worry about mowing their lawn or doing landscaping. They also can take responsibility for trash pickup, snow removal, as well as cleaning and painting exteriors. Common spaces also usually fall under the umbrella of the Homeowners Association; repairing roads, roofs, walls and building components (particularly in a condominium complex.) Needless to say, the more services offered by the association, the higher the fee, services can even include heating and air conditioning systems, electrical systems, plumbing, and security systems can be handled exclusively by the HOA.

Generally, an HOA establishes rules to ensure the neighborhood looks clean and presentable – these rules often come in the form of strict guidelines regarding anything from how tall residents grass can grow to restricting the palate of paint colors residents are allowed to paint the exterior of their houses in. This limited personalization ties into the idea of following a HOAs rules, and can help with the overall property values. These rules also ensure that one or two rogue properties don’t weigh down the value of other properties due to an unpleasant exterior (single-family homes under HOAs sell for 4% more on average than similar homes outside of HOAs). However, residents also regularly cite restrictions on exterior home improvements as one of the worst aspects of living in a community association.

Some homeowner’s associations host social gatherings like block parties, community yard sales, cookouts, and pool parties. Once a member of the association, residents will have the opportunity to become active within the association or even be elected to serve on the HOA board, and have a chance to become better acquainted with their neighbors. HOAs also provide resources for conflict resolution between residents, whether it is over a neighbor playing music too loud, dogs barking at all hours of the night, or parking disputes. Residents can talk to their HOA about their grievances, and the association or management company will take it from there.

An issue that association members commonly face is stringent rules and penalties for running afoul of particular rules. HOAs can have meticulous guidelines, particularly in regards to home exteriors. For example, some of the infractions that could cause a fee to be issued are; a garbage can in view of the public or a neighbor, unkempt conditions like mildew or peeling paint, leaving sports equipment or bicycles out after certain hours, and having a dirty driveway or sidewalk. If residents don’t pay fines, they run the risk of the HOA placing a lien on their property or even losing their home to foreclosure. In many cases, joining a homeowner’s association is agreeing to forfeit some freedoms. In a community governed by the HOA, residents have to follow all the established rules, even if they think they are ridiculous.

Homeowner’s associations have a lot to offer, especially in regards to amenities and community upkeep, but they often come with expensive fees and strict stipulations. One of the best things prospective home buyers can do when looking at properties in a HOA’s declaration or master deed. The more research buyers can do when considering a HOA community, the better prepared they will be if they do become an association member. It is also of the upmost importance that potential residents review their budget, lifestyle and personal preference. While having access to a pool or golf course might be appealing, remembering to keep trash cans out of sight or their driveway immaculate might be something many people don’t want to add to their to-do list.