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Pros and Cons of an HOA

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A homeowners association, commonly referred to as an HOA, can be best defined as, “an organization in a subdivision, planned community or condominium that makes and enforces rules for the properties in its jurisdiction,” according to Investopedia.com.

Although HOA’s are usually associated with condos and townhouses, they’re also becoming more common for detached single-family houses in planned communities. HOA’s are set and enforced to maintain the value of the area and control things that would normally cause a decrease in resale value in the subdivision if left unattended.

One of the many important decisions when purchasing a home is whether or not you choose one that has an HOA. As with anything in life, there are pro’s and con’s. Before deciding to purchase a home associated with an HOA, it’s crucial that you understand both sides and know what to look for when deciding if a specific homeowners association is a good choice for you.

The Pros:

  • Chances are, your HOA will also cover maintenance to your property. This could range from snow removal to fences and landscaping to painting the exterior of your house.
  • Some HOA’s include utilities like trash removal, water and sewer. While this is not a constant line item across the board, it’s certainly not unheard of and could save you time when paying your monthly bills.
  • Pest Control s also usually include with your HOA fee. Knowing that spiders love basements and moles inhabit play areas, this is a huge benefit.
  • Most HOA’s  include what is called, “master insurance.”  Master insurance is an insurance policy that covers parts of the property that is shared by all the homeowners like clubhouses, community pools, gyms, parks and parking areas. If your home is a water-front property, it’s likely that the HOA will have it’s own private beach, docks and swimming areas, too.
  • Some communities with an HOA include a higher measure of security with anything from a coded gate entry to 24/7 patrol.

The Cons

  • HOA’s legally can and often do levy fines as prescribed in the bylaws agreed upon. These rules are every bit as enforceable as if you received a speeding ticket from a local police officer. Don’t want to keep paying your dues? A lien can be put on your property.
  • Want to wave a Detroit Lions flag on your porch to show your team support? Check the rules first. Most HOA’s don’t allow temporary flags to be displayed. The same goes with certain types of plants, playsets, mailboxes, lawn decor and even the number of vehicles and pets you can keep on the property.
  • Chances are, every few years you’ll get a notice in the mail that it’s time to paint your house. You’ll have a deadline for when this needs to be done and you’ll have six colors to choose from… and you’ll pay out of your own pocket to do so. If it’s not done or done up to the standards of the HOA then you can most certainly expect a fine. 
  • Make sure your lawn mower works because if your grass grows more than the maximum limit set by the HOA, you’ll get a fine. 
  • HOA fees are not set in stone and can increase at anytime. 

Long story short, if you want to live in a (seemingly guaranteed) neighborhood that looks well maintained and has a theme of sorts, an HOA may be a great fit for you. But if you want to park your boat or RV next to the open space by your garage, you probably won’t be able to.

Do your research, talk with the President or Chairman of the HOA and be sure to ask any questions that are on your mind. An HOA can be a wonderful thing if you agree and adhere to the bylaws. If you don’t, it can be a nightmare and end up costing you headaches and even potentially thousands of dollars in the long run.

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