As you shop for a home, you will need to decide if you are open to purchasing in a neighborhood with an HOA or not. This decision will impact your budget and daily life, so it is an important one. Let’s go over the pros and cons of an HOA, as well as what you should look for if you are willing to consider an HOA.
Pros of HOAs
- A neighborhood with an HOA can have shared features and amenities. Examples include a shared lawn, a swimming pool, a playground, basketball courts, tennis courts, etc. The fees go toward maintaining these amenities.
- Since the HOA handles maintenance on shared amenities, you do not have to worry about the logistics.
- HOAs can maintain standards for the neighborhood. If those standards are aligned with what you want, you will be glad to live in a neighborhood that suits you.
- Property values can sometimes be enhanced when an HOA does a great job managing a neighborhood.
- An HOA gives you some recourse in case you have complaints about the neighborhood. If there are disruptions or if something needs maintenance, you can ask the HOA to do something about it. They can also act as a third party to arbitrate disputes between you and neighbors instead of you having to hash out issues with your neighbors on your own.
- In some scenarios, utilities bills are covered in part by the HOA, especially for water, gas, sewer and recycling. When these costs are bundled together through the HOA, they can be less expensive for residents.
Cons of HOAs
- HOAs charge fees. That is one more cost to tack onto your budget as a homeowner. HOA fees can also increase over time. Although the benefits the fees buy you may technically outpace their costs, the costs can still be high.
- If you fail to pay your HOA fees, the HOA may place a lien against you, or you can be foreclosed on.
- There may be restrictions on what you are allowed to do with your exterior, In fact, HOA rules can be very strict and specific. They might tell you how tall your grass is allowed to grow before you need to mow your lawn, what specific shade of paint you need to choose for your mailbox, what the dimensions of your fences are allowed to be, and so forth. These rules can restrict your freedom in terms of your home’s appearance, your landscaping features, and even how you structure your time.
- Some HOAs have toxic management, and may be a pain to deal with. They might add more stress to your life than they remove. They could be slow or uncommunicative, escalate conflicts instead of resolving them, refuse to work with you when you need it, etc.
- If you eventually want to resell your home, it might be more challenging if the HOA is known to be toxic. There are also a lot of homebuyers that simply will not consider a home if there is an HOA involved.
What to Look for in an HOA
You can see that whether the pros of an HOA exceed the cons depends in part on your preferences, and also on whether you have found a good HOA or not. Here are some things to look into when you are evaluating an HOA:
- The HOA’s financials should be healthy. It needs to be able to afford to perform its duties, and sustainable enough to do so long-term.
- You should check out the features and amenities that the HOA is responsible for maintaining. See if everything is in working condition and looks nice, or if it has fallen into disrepair.
- Learn what fees the HOA charges, how much they have increased by over the years, and what they cover.
- Look up the HOA’s full rules and regulations, and make sure you would feel comfortable abiding by them.
- Try and find out the primary goals of the HOA, and how they meet those goals and maintain those standards.
- Ask around to get some feedback about how the HOA conducts itself, and whether the management culture is constructive or not.
Once you have researched everything above, you should be able to picture what living under the HOA will be like.
Buy a Home in Ohio
Ultimately, whether or not you should buy a home in an HOA neighborhood depends on your priorities and preferences. Just make sure that if you do, the HOA is a good one.
Liberty Capital is based in Columbus, and can help you buy your first home or refinance anywhere in Ohio. To get started, please give us a call at (614) 505-0620 to schedule your consultation.
