The pros and cons of having an HOA
Home Owners Associations
by Brian Jenkins
Preventive Home Maintenance Tasks for New Homeowners
DIY Home Sale Options
Comparing Home Mortgages
When you decide to purchase a home, you are met with many difficult decisions. You must decide on the type of home, one or two story homes, a porch or no porch, one or two car garage, and the neighborhood to live in. However, there is another decision every home buyer must make; do I want a neighborhood with a Home Owners Association? This is a decision that should not be taken lightly. There are many pros and cons to consider before you decide.
Pros of an HOA:
You may have heard horror stories depicting battles between home owners and Home Owners Associations. However, there are some pros of buying a home in an HOA established neighborhood that you should take into consideration. Here are a few:
- Assists in Maintaining Property Values: One responsibility of Home Owners Associations is assuring the neighborhood looks good. By regulating certain aspects of neighborhood behavior such as parking, cluttered lawns, and opened garage doors, the neighborhood will look good to future buyers and property appraisers.
- Mediates Neighbor Disputes: In every neighborhood, there are neighbors you just can't seem to get along with. Many of these disputes end in retaliation, court, or worse. An HOA is responsible for mediating between neighbors to resolve disagreements and keep the peace within the community.
- Provides Community Services: Another benefit of Home Owners Associations is the community benefits they provide. During the winter, an HOA may provide snow removal services and lawn care may be provided in the summer months. This is to assure the neighborhood is well sculpted while taking the burden off the home owners.
- Maintains Common Areas: If your neighborhood has a park or a lake, your HOA will take responsibility for keeping it maintained and clean. Playground equipment will remain safe and waters will remain clean in order to keep property values high.
Calculator: How Much House Can I Afford?
Cons of an HOA:
There are two sides to every coin. Where Home Owners Associations are concerned, there are a few cons that you must weigh to determine if the pros are worth it. A neighborhood with an HOA is not meant for everyone, so consider these cons to see if it is meant for you.
- Intrusion on Your Rights: One of the biggest issues many have with a Home Owners Association is the intrusion on the home owner's rights. An HOA has the authority to make you mow your lawn to a certain length, dictate the type of dog you can own, and make you paint your home if your paint is chipped or stained. Many believe this intrusion on their rights as a property owner is unacceptable.
- Screening Renters: If you decide to move and rent out your home, you may need to have your renters screened by the HOA. This can cause conflicts with finding renters and moving within your own time frame, and the HOA can even dictate how much you charge for rent.
- Dues, Dues, Dues: An HOA often charges dues to fund the services they provide. These are often expensive and can be raised without much notice. Failure to pay dues may result in fines, a lien, or even foreclosure.
Owning a home comes with many freedoms that renting just can't offer. However, depending on your intentions for your property, you may find those freedoms being governed by an HOA. If you would like to assure your property value stays high, your neighborhood stays well kept and clean, you may want an HOA governing your community. Determine what you want from your property, what you would like to do with your property, and whether an HOA benefits you and your intentions.
Take the Next Step:
- Visit the TDS Library for more buying and selling a home.
- If you haven't looked for a lower mortgage rate in the past year you could be wasting money each month. Use our simple tool that compares different lenders to see what your monthly mortgage payment could be. It's private, only takes a minute and could show you how to save thousands!
- Don't miss the 6 things you must do before buying a home.
Share your thoughts about this article with the editor.
More Money-Saving Tips for Your Home
- Should I use a HELOC for home remodeling and repairs?
- Find the best mortgage rates in your area
- 3 ways to use a mortgage calculator
- Mortgage calculator: Calculate your payment and more
- Home equity calculator: HELOC vs. line of credit
- How much can additional payments save me on my mortgage?
- Who offers the most home insurance discounts?