The pros and cons of homeowner associations

Many times when you purchase a home within a “community” there is a homeowners association. A majority of the time they are condominiums or townhomes within a subdivision or a gated community, but that is not always the case. Before purchasing one of these types of properties there are several items to consider.

First, let’s talk money; Homeowners associations usually have association dues. These dues are usually paid on a monthly basis but some collect on a semiannual or annual basis. Some complexes will provide amenities for your dues. The most common are exterior insurance, lawn care, snow removal, garbage service. Some complexes even go as far to include heat, gas, cable television, and wifi internet services. Your dues could also go for common area amenities such as a swimming pool, fitness center and clubhouses. A portion of the dues is usually put aside for upkeep such as building maintenances, day to day clean up or even as far as repaving the parking lot.

Make sure to learn the rules of the complex as well. Many homeowners associations will have specific guidelines like how many pets you can have inside your home or a limit on the height of a fence you can install. Do you own a boat or RV? Many associations do not allow them parked on the property.

Do your own research on the association and set up a meeting with the president of the association and ask for copies of previous meeting minutes. This will give you an insight to what the board of directors has been discussing. Are they planning on increasing the monthly dues or are they planning a large project? Are they fiscally responsible? To they have enough in reserves to pay for an emergency? Talk to other unit owners as well if possible. Many times you can catch someone in an elevator or lobby when you are there meeting your inspector or viewing the property prior to purchasing it. Also check the dues of associations surrounding this one. How do they compare?

Ask if there are any pending special assessments. This is important since a special assessment can be a sign of a weak or broke association. Special assessments are sometimes called to pay for a project which the association does not have enough money to pay for already. A special assessment can be used for such things like a new roof or the installation of new windows in the complex.

At the end of the day, homeowner associations are wonderful for some and many times will include a majority of your utilities but keep in mind that they’re not for everyone. They can offer plenty of amenities, but they always come with a cost: the more the amenities the greater that cost. And there are guidelines to follow, with the penalty for violating them often involving fines. True, you would never have to worry about cutting the lawn or shoveling snow again, but do plenty of research prior to buying in.

To contact me, call 847-292-4700, email gz@zerillorealty.com or visit www.zerillorealty.com.