Frequently, when an investor goes to make an initial rental home purchase, they look for a lower cost home. That is typically a condo in a homeowner’s association, which we call an HOA. If you’re going to buy in an HOA, you need to be aware of
the positives and negatives.
The positive thing is that there’s a board which oversees the association and makes sure everyone complies with all the rules.
The negative thing is that there’s a board which oversees the association and makes sure everyone complies with all the rules.
Things to Consider with HOAs
Sometimes, there’s an Emperor within the HOA who likes to lord over everyone. Before you purchase and you’ve looked at the cost, read all the documents that go with this association. You’ll want to check the CC&Rs, the bylaws, their policies, and any rules they have. Look at the association’s financial condition, too. You need to know how much power you’re giving these people, and it’s usually a whole lot of power. They can levy fines on your property and they even can sell your property. You may think you own your property, and you don’t want to find out that someone else owns it after you sell it. That’s a lot of power within the HOA.
Property Management in Livermore: HOA Finances
You also need to check an association’s financial condition. Some associations charge a lot and they don’t give you much in the way of improvements for the area. Other associations have lower fees and better facilities. Measure the community management services included with your HOA fees. You can always become a member of the board and help determine how that money is spent.
HOA Rules and Fines
Frequently, the HOA will send out a notice or hit people with violations because they don’t like their grass or trees or paint on the front door. You need to know the rules, and you can’t ignore them. The HOA does have the power to levy fines and sell your property. The best course of action if you do buy a home in an HOA is to go ahead and comply the best you can. Pay up for any fines they bring against you, and then protest those fines. You can hire an attorney and fight in court if you feel it’s appropriate. However, the courts give a lot of deference to the HOA and so a lot of lawsuits are just not successful.
Buying in an HOA can be a good investment but it can also be a nightmare. Be careful with these communities. If you have any questions about Livermore property management, please contact us at AVR Properties.
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- Ken Bradley
- ken Bradley