By definition, homeowners' associations (HOAs) are non-profit corporations within communities that are responsible for its operations. Established via the governing documents, HOAs are comprised of the owners and are like mini-governments. Owners elect a board to represent the best interests of the community and to assess fees to cover operation expenses and fund reserve funds. It is mandatory for all owners to be members, and each owner has one vote.
Assessment fees are almost always associated with HOAs. These fees vary widely and are based on the amount of common areas and amenities within communities. Essentially, the more you have within the community, the higher the fees will be.
If you are a prospective buyer in a HOA-run community, you are entitled to review the covenants and restrictions (C & R) as well as the budget. The C & R will delineate the rules and regulations that make up the community and that will be enforced. These could include restrictions on landscaping, parking, home's exterior, fencing, pets-the list could be extremely extensive!
What do you think? For some homeowners, it could be too restrictive and costly, but there are distinct advantages. The primary purpose of any HOA is to protect home values and the distinguishing lifestyle within a community. So, it makes sense that HOA communities have the best track record for preserving and increasing home values.
Jay and I have lived in Kelly Plantation in Destin since 2002. This gated community has a HOA, and I served on the board of directors for six years. Yes, we do have some strict restrictions, but I prefer that to having neighbors who have no pride of ownership that could devalue our home. Bottom line, your home is an investment, and the environs of your community can bring the value up or knock it down.
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