What Homebuyers Should Know About Homeowner’s Associations
When buying a home in any community it’s important to know in advance if there is a home owner’s association. Here we explain what homebuyers should know about homeowner’s associations? When buying a home it’s important for prospective homebuyers to have a basic understanding of HOA’s and how their rules and regulations will impact their monthly budgets and their home value.
First, when planning to purchase a home, prospective homebuyers should find out if the home is located in a neighborhood with an HOA. If so, the next step is to determine the dollar amount of the monthly dues or fees. By the way, when viewing the real estate listing information for any given property, NEVER assume the HOA amount posted in the listing is accurate. Always verify, before making an offer to buy.
In our City of Santa Clarita, we have some neighborhoods with more than one homeowner’s association and sometimes the residents must pay two monthly HOA fees! Also, don’t confuse the homeowner’s association dues with Mello Roos Tax or other hidden bond assessments because the two are completely unrelated. There are a few Santa Clarita neighborhoods where the homeowner must pay for monthly HOA dues AND the annual Mello Roos Taxes. As usual, when planning to buy a home it’s important to ask lots of questions, before making an offer.
How Much Do HOA’s Cost?
The dollar amount for HOA dues differs from neighborhood to neighborhood. The amounts will range from insubstantial, to OUCH! For instance, in our Valencia Northpark community, the dues are currently $41 per month and this will likely remain the same for a number of years. That’s a small price to pay when considering residents have access to three swimming pools, tennis courts, basketball courts and hot tubs. Then again, there are some neighborhoods with HOA’s costing over $400 per month! Some might assume the more costly homeowner associations result in more benefits to the residents, but this isn’t usually true.
What are the Benefits of Homeowner’s Associations
The primary benefits of owning a home within a neighborhood with a HOA include:
- Maintain Higher Home Values! Because all owners are required to keep their property maintained, the neighborhoods continue looking good as they age. You won’t find homes with broken down old cars in the driveway or weeds growing in the front yard. Usually, it’s required for each homeowner to keep maintained all visible parts of the exterior of the property.
- Community Amenities – Recreation facilities available to residents and their guests. Some neighborhoods have pools, spas, gyms, lakes, golf courses, and more.
- There are some HOA’s where they even include maintaining the exterior of each home, but this is usually for condominium or townhome complexes.
Be Cautious of Homeowner’s Associations
HOA’s have a huge amount of legal power over their members! Depending on the rules and regulations, they can place a lien a property and use other legal methods to force homeowners into compliance.
Some residents really dislike their HOA’s just because of their threatening nature, while others seem to embrace it. Some HOA’s play a more passive role, but others can be pushy and threatening. In Valencia Northpark we have a full stack of rules and regulations, but generally, if residents only use common sense and treat their neighbors with respect, there is almost never any problem.
We’ve heard about other HOA’s where it’s completely the opposite. Before buying a home within and HOA, we suggest speaking with a few neighbors and asking questions. You should also be provided with the Homeowner’s Association rules, regs and guidelines before closing your transactions.
Final Thoughts on HOA’s
Generally, homeowners associations are great for keeping home values at their best, but they can be costly and inconvenient. The homeowner may not think he or she needs to re-paint the outside of their home for another year or two, but the HOA could think differently. If you are not one who appreciates being told what to do, we suggest buying a home in a neighborhood with a passive HOA, or none at all. If you have no problem following neighborhood rules and regulations, you have nothing to worry about.
We believe it’s important homebuyers should know about homeowner’s associations in advance to avoid any surprises or disappointment later. In some instances, it might be possible to read the HOA Rules and Regulations before making an offer to buy, but be warned, most of it is legal mumbo jumbo and not fun to read!
As with most of our home buyer’s tools, we continue to urge our prospective homebuyers to ask lots of questions, BEFORE making an offer on a home. The goal is to be prepared for the entire home buying process and avoid costly mistakes or surprises down the road. We hope our Homebuyer’s Toolkit visitors found this post helpful and look forward to comments about our topic, What Homebuyers Should Know About Homeowner’s Associations.