Updated: Mar 18
As you begin looking for a home to purchase, you will start to come across houses that have a homeowner’s association. This is an association made up of the people who own homes in the area, created to help maintain certain standards in the community. They set rules and regulations for all kinds of things, from the color you can paint your house to the time you need to turn down the stereo in your backyard.
You will need to decide whether or not you want to live in a neighborhood with an existing homeowner’s association or whether you would rather avoid them. This is, of course, a personal choice, but you should know what homeowner’s associations are all about before you make the call.
Why A Homeowner’s Association?
If you have ever had neighbors who were incredibly loud, let their house get run-down, behaved inappropriately, or any of the long list of things that can make life unpleasant and bring down the value of your home, you know why a homeowner’s association can be helpful. With rules for conduct among neighbors clearly set out, you can be confident that your home’s value won’t be brought down by a pile of old appliances in the neighbor’s yard.
You can also avoid nasty confrontations with your neighbors by simply taking grievances before the homeowner’s association board and letting them handle any rule violations.
Homeowner’s associations also often take care of shared areas in the neighborhood, keeping them available for the use of the families in the association. This many include a park or a pool.
HOA's rule and regulation documents are usually in the form of a Declaration of Covenants, Conditions, and Restrictions (CC&Rs) and Bylaws.
The CC&Rs set out the rules of the HOA community. They describe the requirements and limitations of what you can do with your property. The goal of the CC&Rs is to protect, preserve, and enhance property values in the community.
The Bylaws, on the other hand, govern how the HOA operates. They describe how to run the HOA as a business.
The Cost Of An Association
Every homeowner’s association collects dues monthly or yearly from the people who live in the neighborhood. This money goes toward running the association and taking care of the shared spaces. You will be informed of this amount before you buy, and should factor it into your monthly budget.
There is another cost to belonging to a homeowner’s association, and that is a little bit of your freedom. When you live in an association area, you will have to abide by the rules as well, even if you think they are silly. You do, however, have the option of petitioning the homeowner’s association to change any rule you don’t agree with. But if you lose, you will have to live with it.
When purchase a new home, ask the seller for HOA disclosure, CC&R and Bylaws. The disclosure should provide you information such as initial fee, monthly dues, special assessment dues, HOA management company, services and amenities included in the dues. CC&R and Bylaws will give you a good idea of the rules and regulations for the community.
There are both good and bad sides to having a homeowner’s association. For those who prefer living in a more controlled environment, they are a great choice. For those who want to be free to do as they want on their property, the constraints might not be appreciated.