Homeowners Association (HOA)
Definition:
A Homeowners Association (HOA) is a governing body responsible for managing and enforcing rules in a community, subdivision, or condominium complex. HOA members are typically property owners within the community, and they pay regular fees (called HOA dues) to cover the maintenance of common areas, such as parks, pools, and landscaping. The HOA also enforces rules and regulations that govern the appearance, behavior, and use of properties within the community.
🔍 Did You Know?
HOA fees can vary widely depending on the community and its amenities, ranging from as low as $50 per month to several hundred dollars. These fees are used to maintain shared spaces and may also fund neighborhood events or repairs.
HOA documents, known as CC&Rs, can be quite long and burdensome to read. Thats is why Picket uses AI to automatically extract and structure HOA rules from a combination of HOA files.Try uploading your HOA CC&Rs in your Picket account to see how it works!!
Examples:
Example 1:
A homeowner in a planned community pays $200 per month in HOA dues. In return, the HOA takes care of landscaping, street maintenance, and the upkeep of community amenities like a pool and clubhouse. The homeowner must also comply with HOA rules about property appearance, such as restrictions on exterior paint colors.
Example 2:
A condo owner pays $300 in monthly HOA fees, which cover maintenance for the building’s common areas, insurance for the building, and utilities like water and garbage collection.
Why It’s Important:
For homeowners, understanding the role of an HOA is crucial, as the rules and fees imposed by the HOA can directly impact property ownership. An HOA can help maintain property values by enforcing community standards, but it may also limit what homeowners can do with their properties. Real estate investors should consider whether HOA restrictions align with their investment strategies, especially when it comes to rental properties.
Who Should Care:
- Homebuyers purchasing a home in a community with an HOA and need to understand the fees and rules.
- Real estate investors looking to invest in properties within HOA communities and must account for HOA fees and restrictions.
- Condominium owners who are required to pay HOA fees for building maintenance and common area services.
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