The HOA fee is how much?
When looking at town homes and condo developments many buyers ask how much the HOA(Home Owners Association) fee or Condo fee is on a monthly basis. Is this the right question? The benefit of living in a community with a fee of one sort or another is that these fees take care of much of the general maintenance, possibly some of the exterior maintenance and in a condo even more. It allows the home owner to live their life without having to be concerned with as many chores on days off.
Everybody likes the fee to be low because none of us like to pay money out every moth when it could be sitting in our own bank account however little interest it earns us there. But is that rational.
What is the difference between an HOA and a condo association?
First let's explain the difference between a condo and a home under a home owner association. A condo or condominium may be an apartment or a townhome. The owner owns everything within the unit up to and including the skin on the walls. What is behind the walls is common and the association is responsible for any repairs unless caused by negligence of a condo owner, including pipes, sewer lines etc. A town home under a home owner association the owner is responsible for everything other than common areas, just as a single family home owner is responsible for their home other than when the association rules and by laws stipulate that the association will cover repairs to certain items even including some exterior maintenance.
Let's consider what these fees might cover
HOA - General area maintenance, snow clearing, maintenance of trees, community pool, community tennis courts, community club house, trash and recycling service, maybe roof maintenance due to community rules that all roofs are replaced on a regular basis to maintain the correct look throughout the community.
Condo - All of the above, but it may also include water, hot water, gas for cooking, electricity, any maintenance to common areas of the units including pest treatment.
What is Not Covered?
What is often not covered by either type of association may be windows, doors, sliders, balconies, decks although it is always wise to read the association documentation to verify what is covered and what is not.
Why would a fee be high?
It all depends what is actually covered, the age of the units within the complex. Very often new complexes have lower fees because they have no repair history, being new they expect to build up reserves to cover needed repairs by the time they are required. Older complexes have a history and the management knows what to expect and how much they need in the association reserves to cover roofs replacement.
Some associations plan to have a special assessment when they repair roofs or balconies or decks and everyone gets an assessment and often a period of time to pay it in one installment or over time.
An association may also have had several recurring problems such as stucco, or repairs to chimneys in a community for example and decided rather than tackling the issue piece meal to take it head on and repair everyones chimney or stucco issue in one go.
What system is better?
High fees with no assessments, or low fees with regular assessments, it all depends where in the cycle the complex may be. If there are a lot of repairs coming up you will want to know what the expected repairs and costs are going to be as well as the level of the assessments. Some homeowners will try to sell before an assessment hits, others will offer to pay part or all of the assessment for a new owner as an incentive to purchase their unit.
These are all things to consider when buying a home in a home owners association or with in a condo association; along with what are the rules for both, can you live within those rules or will they curb your lifestyle. Do they allow kids swing sets behind a unit, or are you allowed a grill of any type on a balcony, maybe you cannot park trucks or vans outside of a garage overnight, etc.
Many of these associations have restrictions, but these restrictions are often why people love to live in these communities, they know there are certain standards that are going to be maintained.
We have many communities in the Main Line area that are either regulated under a home owner association or are condominiums. Let us help you find your home in the perfect community in the perfect location.