If you’re considering the purchase of residential or commercial properties that features shared common areas such as a neighborhood pool, parking garage, security fences or sidewalks that border each residence, then you may also want to consider the advantages provided through the creation of a homeowners association or HOA.
HOA’s exist with the goal of helping neighborhoods look their best and function smoothly by allowing many to help pay for the upkeep of certain fixtures rather than requiring one person to donate all the time and money necessary for their regular maintenance. This can be an excellent option for landowners as it allows them to share the burden of upkeep with the occupants who wish to keep the amenities in proper working order.
This is done through homeowners association fees which can be collected on a monthly or yearly basis from all members of the community. An average single-family home can expect to pay around $200 to $300 per month in HOA fees. These costs can vary depending on the size of the unit and the number of services provided. As a general rule, the larger the occupancy, the higher the fees since they will probably use the services provided more than someone residing in a smaller home or residence.
Additionally, most HOAs will charge each member a little more than what is required for monthly expenses so as to build up savings for emergencies and big-ticket replacements and repairs. If the cost is more than what’s been set aside in reserves, then the HOA may be able to issue an “assessment” or extra fee in order to make up the difference. This allows the cost to be shared among the community, significantly limiting the amount any one individual would have to pay.
The business of the HOA is conducted through boards, typically comprised of the homeowners within the complex, which are elected by the other homeowners who compose the HOA. The board holds regular meetings where owners can gather and discuss major issues affecting the community and make decisions in order to solve them.
In order to make sure the expectations for occupancy are respected and upheld, many homeowners associations will develop certain rules. These rules are also known as “covenants, conditions, and restrictions” and require each homeowner to abide by certain rules in order to maintain residency in the neighborhood. Every new homeowner will receive a copy of these rules which can cover anything from what size and type of mailbox is allowed to what size and breed of dog you can maintain. HOA’s can even dictate what colors your home can be painted in an attempt to limit wild and garnish decorating choices. The goal isn’t to meddle, but to merely provide a living standard that ensures a certain quality of life for all who live in the community. This can be very advantageous to commercial or residential property owners who wish to protect their investment by setting a tone for living in the community.
To learn more about Home Owner’s Associations and how they can be a benefit to commercial and residential property management, contact our offices in Los Gatos, CA and let us know how we can help you.