You’re looking through homes online and spot one you love. It looks great, it’s the perfect size, and the price is right. You scroll down to see it has a homeowners association with dues that total $150 a month. Do you click away as fast as you can? Or are you impressed?
Many buyers wonder if they should avoid, or seek out, real estate with an HOA. On one hand, HOAs can be expensive and buyers who’ve been scrimping and saving to afford a home probably won’t look kindly on the extra monthly fee. On the other hand, HOAs can do a lot of good, like taking the stress off of home and yard maintenance.
If homeowners build structures on their property to repair race cars (extremely loud noise) or hoarding and having over 100 cats on their property that cause damage and bring an intensely bad smell to the area. The rules and bylaws an HOA can create and enforce rules to not allow homeowners to do these kinds of things.
Over 40% of listings are subject to HOA dues nationwide. New builds are especially likely to have HOAs, at a rate of nearly two-thirds.
Pro: HOAs may provide amenities homeowners might not be able to afford otherwise.
HOAs are designed to help your community look its best and function efficiently, often providing gardening services and repairs for common areas and parts of the residents’ homes (such as roof and exterior siding). They also often provide community amenities such as swimming pools, security gates, snow and trash removal, and parking garages.
These amenities can be especially valuable for certain buyers. A family with kids, for example, might be glad to pay HOA dues in exchange for community playgrounds and a (gated) community pool they don’t need to maintain. Safety-conscious buyers might love the idea of a security gate and community security patrol.
Con: HOAs may provide amenities you don’t need—and set rules you don’t want to follow.
On the flip side, some buyers simply don’t need, or want, the amenities offered by an HOA. In this case, experts ask: Why pay more for what you’re not going to use? Many people simply don’t need, or won’t enjoy, the amenities and services a certain HOA offers.
If you don’t like shoveling snow, an HOA is handy. If you don’t live somewhere it snows, paying an HOA is unnecessary. Plus, HOAs often enforce rules some people might not want to follow, like exterior paint colors that are allowed, permissible home renovations, and even how many pets a resident can have. Some homeowners will end up paying for services they don’t use just to give up some freedoms related to how they maintain their own property.
Pro: HOAs can improve the look of a neighborhood—and improve your home’s saleability
Con: You run the risk of steep increases in HOA dues
Knowing your HOA could help you sell your home may make paying dues a little easier. But what happens when your fees go up? Many buyers don’t account for HOA fee increases, which often happen annually.
So, HOA or no?
When it comes down to it, it can make financial sense to go with an HOA house—as long as the fees are reasonable and the HOA is well-managed. It’s an investment in preserving your home’s curb appeal and market value. She advises buyers to review the covenants, conditions, and restrictions, budgets, history of the fees increasing, and potential assessments before committing to a home with an HOA.
for more information on this topic, see https://www.realtor.com/advice/buy/hoa-fees-pros-cons
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