We’ve been blogging about what it’s like to live in an HOA. In the first post in this series, we outlined some general considerations about what an HOA is and what it’s intended to achieve. In the second installment, we offered tips on avoiding some of the most common HOA rules violations.
We’re going to wrap things up today with a list of tips and suggestions for potential buyers. Maybe you’ve got your eye on a house that happens to be in an HOA. What should you do to make sure you really know what you’re getting into… and that you’ll ultimately fit in well in the homeowners’ community?
Here are our guidelines for buying a house in an HOA.
Buying a House in an HOA: Our Tips
- Verify that HOA membership is mandatory. Some communities refer to themselves as HOAs, but membership is completely voluntary; they can’t really enforce rules and you don’t have to pay any dues. That’s obviously a very different scenario than a mandatory HOA, so double check that you know which one you’re buying into.
- Ask to see all governing documents. When you buy into an HOA, you agree to follow a set of rules and regulations… so naturally, you’ll want to know what those rules are! Your real estate agent should be able to get you complete governing documents. Make sure you go over them very carefully and reach out to your agent or to the HOA directly if you have questions.
- Review the financials. The last thing you want is to buy into an HOA that’s financially unsound. You’ll be paying dues into the Association, and it’s important that those funds are being handled responsibly. Ask for the current year’s budget, the most recent reserve study, and the latest financial reports to get a sense of the HOA’s fiscal health.
- Confirm the dues. Speaking of finances, make sure you know how much you can expect to pay in dues… and also, ask how regularly the rate is increased!
- Look at meeting minutes. Something else you might do is ask to see a copy of the minutes from the most recent HOA meeting. This can provide some kind of insight into the issues that the Association is dealing with and may also include some illuminating points about community maintenance and repair needs.
- Spend some time in the common areas. Remember, you’re not just purchasing a home. You’re also buying into the community itself, and assuming some partial ownership of common areas. It’s well within your rights, then, to make sure those common areas are up to par. Visit the pool, the clubhouse, parks, playgrounds, etc. and assess their state of upkeep. Also pay attention to sidewalks and roads. Remember, the HOA is in charge of maintaining them. Are they doing a good job?
- Research turnover in the community. How often do people move out of the HOA? And when they do decide to list, how long does it take for the home to sell? Your real estate agent can help you find these answers.
- Inquire about volunteer positions. Do you think you’d like to get involved in the HOA? In most HOA communities, there are plenty of volunteer positions available. Ask how long you have to be a resident before you can volunteer; also see what kinds of positions are open, and when the next Board elections are scheduled.
These are just a few of the steps we would recommend for anyone looking to buy into an HOA. We hope this quick checklist helps you make a confident and informed decision about whether HOA life is right for you!
That does it for our Intro to HOA Life series. But before you go, just one more thing: You may soon decide you’re ready to sell your house. And when you do, we’ve got you covered. We welcome you to request your free SOLD.com report today and find out for yourself the best way of getting your place sold.
In your free report, you’ll get an independent, unbiased recommendation for how you should approach selling your house. Don’t delay; claim your SOLD.com report now!