Homeowners' Associations (HOA)

Important for Property Values

Since 1964, homeowner associations have become increasingly common in the USA. The Community Associations Institute trade association estimated that HOAs governed 23 million American homes and 57 million residents in 2006.

2.Legal Standing of HOA’s.  A homeowners association is incorporated along with the by-laws, covenants (called protective covenants, restrictive covenants, and the declaration of restrictive covenants) by the developer prior to development and building of homes. When homeowners purchase homes governed by an HOA, they sign a rider on their deed which acknowledges they will abide by its restrictions.

3.The HOA Board.   The board of directors manages the affairs of the Association and elects officers, and may create subcommittees, such as "architectural review committees", pool committees, grounds committees, and neighborhood watch committees.

Following subdivision ‘build-out’, association boards are comprised of volunteers from the community who are elected at the annual meeting to represent the association and make decisions for all homeowners.

4.Homeowner Assessments.  Homeowners in communities with an HOA pay a share, usually per-lot, of common expenses. These expenses generally arise from common property, which varies depending on the community.

5.Benefits.  The purpose of a homeowners association is to maintain, enhance and protect the common areas of a community and the interests of an association.  This can allow an individual homeowner access to an amenity (pond, pool, clubhouse, etc.) that he may not be  able to afford on his own.

Each member of a homeowners association pays assessments. The assessments are used to pay the expenses of community. Some examples are entrance monuments, landscaping for the common area, amenities like clubhouses, tennis courts, or walking trails, insurance for commonly-owned structures and areas, mailing costs for newsletters or other correspondence, a management company or on-site manager, or any other item delineated in the governing documents or agreed to by the Board of Directors.

6.Residents Approve of HOA’s.  A study by Zogby International reported widespread satisfaction by residents of homeowners' associations: 71% overall were pleased with their experience of the homeowner's association. The majority (63%) said that the existence of a homeowner's association did not affect their choice when buying or renting; of the remainder, an HOA was a positive influence 3 times as often as it was a negative influence (28% to 9%). The same study reported that while fewer than one in four residents had ever brought a complaint to their HOA board, three in four of those who did were satisfied with the resolution. Just over 3 in ten residents in homeowners' associations have served on an HOA board.