The term “homeowners association (HOA) fee” refers to a recurring monthly cost that certain residential property owners must pay to their homeowners associations (HOAs). These fees help cover the maintenance and improvement of properties within the community.
HOA fees are standard for most condominiums and some single-family neighborhoods. Also known as “common charges” or “maintenance charges,” these fees are instrumental in managing the community’s amenities and ensuring the upkeep of shared spaces.
Key Insights:
- Regular Dues: HOA fees are monthly dues collected from property owners.
- Standard Requirement: Common for purchased condos, apartments, and planned communities.
- Variable Extent: May also apply to single-family homes in specific neighborhoods.
- Purpose: Used for amenities, property maintenance, and repairs.
- Range: Typically between $200 and $300 monthly, depending on services provided.
Understanding HOA Fees
Homeowners associations create and enforce rules for properties under their jurisdiction. Such associations are typical in planned communities, subdivisions, or condo buildings. Buying a property in an HOA community makes one an automatic member, therefore, incurring monthly or annual fees — known as homeowners association fees.
HOA fees generally cover:
- Lobbies
- Patios
- Landscaping
- Swimming pools
- Elevators
They may also include utilities like water/sewer fees and garbage disposal. Special assessments may be levied occasionally if reserve funds aren’t enough for major repairs, such as a new roof or elevator.
These fees can also be applicable to some townhouses or single-family homes, particularly those with shared amenities like tennis courts, clubhouses, or parks. HOA fee amounts vary widely, usually between $100 to $1,000 a month, based on properties and services provided.
Consequences of Non-Payment
Not paying HOA fees impacts all community members. A shortfall in funds can lead to poorly maintained common areas, or result in other owners facing additional fees. HOAs are legally empowered to take actions against delinquent owners based on their governing contracts. These actions range from charging late fees, initiating lawsuits, placing property liens, to, in extreme cases, initiating foreclosures.
In areas where both condo and HOA fees apply, it’s crucial for buyers to understand their total financial responsibilities pre-purchase.
Criticisms and Challenges
Primary complaints about HOA fees center on their cost, which can compound the financial strain alongside mortgages and utility bills. Mismanaging reserve funds may cause spikes in fees. HOA boards thus bear a fiduciary duty to manage these funds responsibly. Associations can also enforce stringent rules on parking, house painting schedules, fencing styles, and landscaping, sometimes leading to discontent and legal tussles.
Typical Inclusions in HOA Fees
HOA fees usually cover:
- Common area upkeep (lobbies, patios, landscaping)
- Amenities (swimming pools, tennis courts, clubhouses)
- Often some utilities (water, sewer, garbage disposal) Major repairs may require additional special assessments.
HOA Fees Vary Widely
Variable fees reflect amenity costs and local living costs. Communities with extensive facilities or those in high-cost living areas, such as New York City, generally see higher fees. Conversely, lower-cost areas like Harrisburg-Carlisle, Pa., average around $120 monthly.
Conclusion
HOA fees are essential for maintaining shared property spaces in condominiums, co-ops, and some planned neighborhoods. These fees are vital in covering common area maintenance and various community amenities, a crucial consideration for prospective condominium owners calculating monthly expenses.
Related Terms: Homeowners Association, Condominium, Reserve Fund, Special Assessments, Fiduciary Duty.
References
- Inspection Support Network. “Cities with the Worst HOA Fees”.
