Today, it is not uncommon to find a home that is in a neighborhood with an HOA.
HOAs, or homeowner’s associations, are typical in new construction as well as condominiums.
Unfortunately, HOAs have received a bad rap over the last few years, and probably should not have. While they have their negatives, there are plenty of positives to go alongside those associations. Therefore, if you’re thinking of making a purchase in an area with one, consider both sides of the story before making your decision.
What is an HOA?
Investopedia defines an HOA as an organization within a subdivision, planned community, or condominium that has rules for the properties inside that area. The purchase of the property automatically enlists you, the buyer, into the HOA. You will pay an annual HOA fee as part of your homeownership in that area.
These planned community organizations are restrictive, but also helpful for homeowners in that HOA jurisdiction. The rules will depend on the organization, as well as the location.
The Pros of an HOA Neighborhood
Excellent Neighborhood Aesthetics: The HOA has restrictions on how homes can look in the neighborhood; therefore, you never have to worry about a neighbor with an overgrown lawn, weeds, or peeling paint bringing down your value.
Less Maintenance: Part of your annual fee goes toward the HOA handling a vast majority of your maintenance to-do’s. They might handle landscaping too; depending on the neighborhood.
Amenities: Typically, an HOA offers amenities, such as a pool, workout center, tennis court, or neighborhood park.
Management: The HOA has their own management, so if you have an issue, you can bring your concerns to the management team.
The Cons of an HOA
Limitations: Want to paint your house a new color? You’ll have to ask the HOA first. Want to change up your garden upfront? You might need permission. Some HOAs even limit you on how you can paint your door and what decorations you can put up.
Fees: The annual fee is due to remain in the neighborhood. The HOA can take legal action against you if you do not keep up with your annual fee too – including having your home repossessed (in severe cases only).