What to Consider Before Buying a Home within a HOA

With more than half of the Lake of the Ozarks real estate listings being part of a homeowner’s association or condo owner’s association, the Fran Campbell Team feels that it’s important for our buyers to have a good understanding of what a HOA/COA is.

A Homeowner’s Association, or HOA, is the governing body of the development or complex, usually comprised of homeowners who have volunteered to serve on the HOA board. The primary purpose of a homeowners association is to manage a neighborhood's common areas such as roads, parks and pools. Most HOAs have their own set of bylaws and regulations that all homeowners and their guests are required to abide by within the subdivision.

Here are some things you should consider before buying a home or condo within a HOA:

What Additional Association Expenses will there be? 
The majority of HOA/COAs have association fee structures. This will vary for each community. Knowing the fees you'll be required to pay will have an impact on your short and long-term finances. Because of this, you should make sure to ask these questions and compare fees against other associations and local cost:
  • How are HOA fee increases set?
  • How often do increases occur, and by how much have they historically been raised?
  • Can you get a printed history of HOA dues by year for the last 10 years?
  • How large is the HOA's reserve fund?
  • Also, ask for a record of special assessments that have been made in the past and ask if any special assessments are planned for the near future. Note that economies of scale can mean that special assessments are higher in smaller HOAs.
  • Find out what the monthly dues cover. Will you still have to pay extra for garbage pickup? Is cable included?

Research Rules, Regulations, Declarations, and Bylaws
As previously pointed out, most associations have their own set of bylaws, declarations, restrictions and regulations. It's important for you to request a copy of those documents for review prior to purchasing. Here are some things you'll want to pay special attention to when reviewing these documents: 
  • Check the bylaws for things such as the voting rights of the members, meeting requirements, and budget and assessment procedures. 
  • Look especially hard at what actions of the Association (such as raising assessments or creating rules) can be done without a vote of the members
  • If you plan to purchase for investment purposes, make sure to check the rental restrictions. Some HOA have restrictions that prohibit renting a property within the community or even restricts the length of rental terms. 
  • Check the rules and regulations for restrictions on owners’ use of private property.
Review HOA Financing and Meeting Minutes
Request copies of the most recent meeting minutes and budget and financial reports before you buy. These documents can be very helpful by providing more information about the policies of the HOA and more. Here are some things you should look for in the minutes:
  • Are there any major maintenance issues that could potentially cause need for a future special assessment? 
  • Is there a history of under-management of building or lawn maintenance? 
  • What are current and past conflicts? 
  • What is the process for resolving any conflicts? 
  • Has the HOA sued anyone? How was that resolved? 
  • Do the financials reflect that the Association has been run too lean, or hasn’t collected enough assessments to meet the budget? This could also be a sign of potential future expense.
Get Information about HOA Amenities
Amenity perks may be the main selling point that draws your interest. A lot of complexes and communities include the use of amenities in the cost of the association fees. However, some do require additional fees to be able to have access. Here are some things you should check into when considering amenities:
  • Do the hours of operation meet your peak use time or will you be paying for amenities that you can't use due to time restrictions?
  • Is there extra cost to use the amenities or is the cost included in your dues?
  • If you plan to have guests over often, be aware of the HOA rules about guest use for common facilities.

With these handy tips for considering a home or condo in a HOA community, you can feel confident that you'll be able to buy a home at the Lake of the Ozarks comfortably and with little surprises. Our expert real estate team at the Lake of the Ozarks is well-seasoned in the world of HOAs, so if you have any questions about a home located in one of the HOA communities at the Lake, you can trust that we'll be able to answer your questions or get the answer quickly for you.

Contact the Fran Campbell Team to get your home SOLD!


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