What's Up With HOA Fees?
Thinking about buying a condo? Besides scoping out pictures online and imagining your amazing housewarming party, you’re probably curious about those Homeowners Association (HOA) fees you keep hearing so much about.
Homeowners Association fees are very common if you live in a condo. HOAs are responsible for collecting monthly or annual fees from each resident (including you!) which go into a “reserve” of money. This collection of funds is intended to help keep the building you share looking and working beautifully all year long. Some of the money goes into regular maintenance like lawn care and garbage collection, but other amounts are saved for special projects like repaving the parking lot, repairing the roof, or fixing a pesky broken elevator.
So how exactly are HOA fees determined? Let’s take a closer look.
Price: The more upscale the building or neighborhood, the higher the fees are likely to be.
Upgrades: If you live in a condo and it needs a new roof, new parking lot, improved HVAC system or hallway decor, those fees will come from the HOA’s reserves.
Special Cases: If there isn’t enough money in the reserves, you – and your fellow residents − could have to pay a special assessment fee if the association approves a project through a vote.
Factors: Fees for each unit are typically based on its size and/or number of bedrooms, etc.
FIND OUT MORE
Fees are handled differently for each association. It’s a great idea to get as many details as you can before you move in by asking the following questions:
- What services and expenses are covered by the HOA fees?
- What’s the process for HOA fee increases?
- What is the dues history for the HOA over the past 5 to 10 years?
- How much money is in the HOA's reserve?
- Has the association asked for special assessments in the past, and are any planned for the future?
- How much does the HOA pay for insurance and what catastrophes are covered?
Related Topics: At Home