What is a homeowners association? Homeowners associations are seen mostly in housing subdivisions. Their purpose is to uphold the maintenance and property value of the subdivision. A homeowners association...
A homeowners association is a non-profit organization that is established to govern a private community or subdivision. The association aims to maintain property values and to preserve a certain standard of quality in the homes that are governed by the association. Richard Fryer, a real estate school president with 30 years of experience, says "the association looks after your best interests as far as protecting your property values by seeing to it that all of the common areas of your subdivision are maintained." The association owns and manages some of the common areas and property of the homeowners. Fryer goes on to say that membership in these associations are mandatory. "Most subdivisions built today have formal homeowners associations and they are not voluntary. When you buy in a subdivision, you have to belong to that homeowner's association," he states. He also says that the HOA will also have an elected board of directors, whose primary responsibility is to manage the budget and enforce deed restrictions. The board is also responsible for calculating what each member should pay in Homeowner's Association fees. Individual owners in the HOA also have the right to participate in the ongoing affairs of the community as well.
Homeowners associations govern many of the homes that have been recently built in the US. The Community Association Institute reports that as many as 1 in 6 Americans live in houses, townhouses and condos managed by homeowners associations. These managed communities have become so popular because its members can enjoy a better standard of living than they could otherwise afford. These associations also keep smaller local and city governments from being unduly burdened for the costs of maintaining rapidly growing neighborhoods since many HOAs handle services such as snow removal and trash pick-up.
In exchange for the benefits and convenience of living in a managed community, HOA members pay a monthly fee in addition to their mortgage. These fees, which are mandatory, can range anywhere from 100-800 dollars a month and are used to care for and maintain the common areas of the subdivision.
In order to preserve and protect the property value of the homes in the subdivision, the HOA will usually establish a set of rules that all members must follow. These rules are referred to as CCRs. Typically the CCRs place restrictions on parking, pets, landscaping, decorating and fence height. In extreme cases, the CCRs in some Homeowners Associations are so strict that activities such as flying the American flag, decorating on for unrecognized holidays and displaying political campaign fliers on the lawn have been banned. While there are many some cases of rogue associations who burden and inconvenience their members with petty and unfair rules, Fryer reassures homeowners that most HOAs are only acting in the best interests of their members by preventing certain actions or activities that devalue the property. "It's just to make sure that everything is consistent; that the architectural guidelines are followed; to make sure that people follow the rules; and it gives us a higher appreciation rate in the subdivision."
