What is an HOA?
Homeowners Associations (HOA) are responsible for the smooth running of property development areas on behalf of the homeowners and the real estate developers. They manage the approximately 62 million residents across the United States. Read on for more information about Homeowners Associations.
HOAs are formed by real estate developers when the development of a plot is nearing its end. Real estate agents sell the plots of land empty, for people to come in and build their own houses, or are sold with pre-built houses. It is far more common for a property developer to sell entire houses.
Why are HOAs Needed?
HOAs are needed to ensure that a community is well taken care of, the common areas are well maintained, and that the regulations and guidelines established in the bylaws are followed. For example, an HOA may wish for the neighborhood to stay within a similar architectural style. The HOA would prevent a homeowner from building an extension that would compromise the look of the community.
Similarly, the HOA should ensure that any new structure maintains the safety standards established by the Association. An equally important aspect of any HOA is determining whether any new structures will impact on other homeowners’ quality of living.
Common areas are one of the core issues that an HOA has to tackle. Houses and shared areas need frequent repair. It is the association’s job, namely that of the board, to make sure that common areas are well taken care of. Keeping shared walls, vegetation, sidewalks, and open areas well maintained help to keep a neighborhood looking at its best.
How is an HOA Governed?
Membership is compulsory as being a member of a homeowners association is tied directly to owning an HOA-managed property. The association collects annual fees for membership. Fees are put towards the management of common areas mostly, such as sidewalks, common vegetation, shared recreational facilities etc.
While a smaller association may be able to run smoothly with a small group of people, most HOAs rely on an elected board of directors to ensure that the community is well maintained. Members pay their fees, and in return, they expect the board repair damaged areas, settle disputes and ensure the community as a whole is well maintained. Any member who flouts association bylaws can face penalties and even fines.
Any member of an HOA is eligible to run for their board. Members of the board are entrusted to take care of the daily running of the association. From the answering of emails to the caring of a damaged shared wall. Their position is, therefore an important one. In most homeowners associations, the board is made up of volunteers who are elected at a general meeting.
Next up: a closer look at the board of directors in a Homeowners Association.