Jeni VanOrnum | Real Estate Insights & Education

Homeowners Associations (HOAs) can be wonderful or nightmarish. Here’s what first-time buyers must understand before purchasing in an HOA community.

What Is an HOA?

An organization that makes and enforces rules for properties in a community (typically condos, townhomes, or planned developments). Members pay fees for maintenance and amenities.

HOA Fees Explained

Monthly or annual payments covering:

• Common area maintenance
• Landscaping
• Snow removal
• Trash collection
• Amenities (pool, gym, clubhouse)
• Insurance for common areas
• Reserve fund for major repairs

Typical Fee Ranges:

• Single-family homes: $50-$300/month
• Townhomes: $100-$400/month
• Condos: $200-$700/month

HOA Rules and Restrictions

Common regulations include:

• Exterior paint colors
• Landscaping requirements
• Parking rules
• Pet restrictions (type, size, number)
• Rental restrictions
• Outdoor decorations
• Noise limitations
• Fence/structure additions

Advantages of HOA Living

• Maintained common areas
• Amenities (pools, fitness centers)
• Property value protection
• Neighborhood consistency
• Dispute resolution
• Community events

Disadvantages of HOA Living

• Monthly fees (forever)
• Restrictions on property use
• Special assessments possible
• Potential for difficult board members
• Rules may change
• Foreclosure risk for non-payment

Critical Documents to Review

CC&Rs (Covenants, Conditions & Restrictions): The governing rules you must follow.

Bylaws: How the HOA operates and makes decisions.

Financial Statements: Review reserve funds and pending litigation.

Meeting Minutes: Understand current issues and upcoming projects.

Reserve Study: Projected major expenses and funding status.

Red Flags to Watch For

• Low reserve funds
• Ongoing litigation
• Deferred maintenance
• Recent special assessments
• High percentage of rentals
• Frequent fee increases
• Restrictive or unusual rules

Questions to Ask

• What are the current fees and payment schedule?
• Have there been recent special assessments?
• What’s the reserve fund balance?
• What percentage of owners are current on dues?
• Is the HOA involved in any lawsuits?
• What are the rental restrictions?
• How often do fees typically increase?

Financing Considerations

Some lenders have requirements about HOA financial health. Very high fees may affect your loan approval.

I’ll Help You Navigate

I’ll ensure you receive and understand all HOA documents before making an offer. Many first-time buyers overlook this crucial research.