When it comes to home buying, there are a number of things to take into consideration when choosing the house that is the right fit for you and your family. You may be looking for a certain number of bedrooms, a big yard, or a convenient commute, but one factor that many potential homeowners overlook initially is whether the home comes with a Homeowners Association, or HOA. So that’s why we’re taking a look at the pros and cons of a homeowners association.
Homeowners Associations are designed so that the homeowners in a particular neighborhood or building all contribute money to fund the upkeep and management of the community. An HOA will come with fees, rules, and limitations as well as benefits, so it’s definitely something you’ll want to pay attention to when budgeting for your new home! These associations have advantages as well as disadvantages, and it will be up to you as the home buyer to decide if the pros outweigh the cons. Judy McLellan of Crye-Leike Realtors is here to help you make an informed decision, so keep reading below to learn more about HOAs!
The pros of HOAs
An attractive neighborhood can increase property value
“Never judge a book by its cover” doesn’t apply to real estate. Homes are judged in part by the neighborhoods and cities they reside within, and HOAs are often a driving force in keeping neighborhoods looking pleasant and well-maintained. This means the homes will generally be seen as more desirable, and you as a homeowner will often benefit from steady increases in property value.
No more neighborly disputes
No matter where you live, you’re likely to have an issue with one of your neighbors at some point in your life. It could be that they play their music too loud when you’re trying to relax, or perhaps they let their dog use your manicured front lawn as a public restroom. Whatever the problem, resolving it can be a much simpler task if you have a mediator. The HOA board will usually act as a third-party mediator when it comes to settling many (non-criminal) grievances between neighbors.
Access to shared amenities
Many HOA neighborhoods have common spaces that everyone is welcome to use, such as parks, pools, clubhouses, fishing ponds, tennis courts, and fitness centers. There’s a lot of upkeep involved in maintaining these kinds of amenities as an individual homeowner. Sharing the responsibility with your neighbors lessens the burden and allows you to get out there and enjoy yourself more frequently!
Sense of community
In an HOA, everyone is under the same rules. Ideally, this ensures that everyone in the neighborhood benefits from the HOA’s presence while also pulling their own weight. Because they are all bound by the same set of regulations, HOAs can be a true community-building body.
The cons of HOAs
Budgeting for dues
HOA dues will vary by neighborhood and are often paid monthly, although some collect annually. This is something you will need to budget for in addition to your mortgage and insurance. When you’re looking at the cost of a new home in a neighborhood with a HOA, make sure you calculate the monthly payment with HOA fees included to give you a more realistic picture of the cost of living. Failure to pay your HOA fees can result in having a lien placed on your home or foreclosure, even if you’ve kept up with your mortgage payments.
Playing by the pre-set rules
HOAs often have a set of predetermined rules for the neighborhood that you’ll need to follow if you buy a house within it. Many of these are as simple as making sure your lawn is mowed on a regular basis, but some can feel rather restrictive, such as dictating what color your blinds have to be. HOA members can petition changes or vote to add new rules, but there’s no guarantee your ideas will be implemented. Look carefully at the HOA regulations of any particular property you’re interested in so you can decide ahead of time if you’ll be able to live with them long-term.
Their problems can become your problems
If you’re part of a HOA that becomes involved in any legal battles or suddenly finds itself facing budgetary issues, the financial burden may be passed onto you as a homeowner. These could potentially lower your home’s property value or cause a spike in your future HOA fees. Removing someone from the HOA board for any reason can also be a costly and difficult process.
Changes need approval
Before you make any major changes to your home or property, you’ll have to get HOA approval. Changing the paint color, adding a porch, fencing your yard, building a treehouse, removing a damaged tree or hedge—anything along these lines is likely to be subject to the HOA rules and approval process. Fortunately, this will already be written out in the HOA’s regulation document, so take care to read the literature closely and ask any questions before you decide to purchase your property.
Make the right choice for you with help from The JudyMac Team of Crye-Leike Realtors
If you’re unsure about whether or not an HOA is right for you, our skilled real estate agents are here to help! An educated client makes better choices, and we’re committed to keeping you fully informed of every possible option. You can count on our team to guide you in making the best choice for you and your family in your search for a new home. If you’re ready to settle down in Downtown, East Memphis, Germantown, Collierville, or beyond, get in touch with us today!