Did you know that the majority of newly developed homes nationally, include a Home Owner’s Association (HOA)? It is important to do your homework when buying into any HOA including High Rise Condominiums, Townhomes, Active Adult Communities, and even Single-Family Neighborhoods. Here are some questions you should ask…

1. Ask About the Fees

The most important question is to ask about the monthly fees. How much are the dues, what do they cover, and how often are they due? Consider these fees along with your mortgage and taxes in your decision to buy.

2. Review the Governing Documents

Every HOA is governed by a distinct set of documents, sometimes referred to as Covenants, Conditions, & Restrictions (CC&Rs), that define the authority of the association. In short, these documents detail what homeowners can and cannot do, as well as what the association is responsible for maintaining and insuring.

3. Is the Community Financially Sound?

Reviewing the financial documents of an association ensure your community is financially sound. Ensure there is a properly funded reserve fund and/or capital improvement account for future upkeep and projects. Accounts receivable balances will ensure your neighbors are current with their payments, and the annual budget will allow you to see what your monthly dues are covering.

4. Are Rentals Allowed?

If you are planning on buying a unit or home as an investment, this is an essential question. Even if you are not planning on renting, it is important to know what percentage of homeowners do rent versus occupy their units in the community. This ratio can affect the conditions of the units/properties and association insurance and loan opportunities.

5. Is there an Association Website or App?

Does the association, or management company, offer an easy way for on-the-go residents to pay, submit work orders, receive communications, etc.?

6. Who is Managing?

Is the association self-managed or do they have a management company and property manager? If the association is being overseen by a management company, it is important to do your due diligence and make sure the management company is experienced and reputable.

Community living has advantages which may include more affordability, less maintenance, access to amenities, and community events. Just make sure you are a smart, informed buyer!