What Is A HOA? How Are HOA’s Governed In The U.S.A.?

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In the United States a homeowner/ homeowners association a.k.a HOA is an association formed privately by the real estate developer. One of the primary reasons to create or form a HOA is to increase property values by adhering to a certain amount of rules and regulations.

When a family or even an individual purchases a home in a residential community, they immediately qualify to become a member of the homeowner’s association. As the community grows, the developer will hand over the entire control of the HOA to the residents of the community. The homeowners within their rights will then elect a Board of Directors to handle  day to day operations.

Homeowner associations (HOA’s) are normally formed among neighborhoods and communities of homes, townhouses, buildings (condominiums). An HOA usually functions as a law/ rules enforcer with regards to the properties in the jurisdiction. An HOA is usually run by the residents of the community. One needs to buy a home or property within a community to immediately qualify for being a member of the HOA.

An HOA comprises a board of directors and/ or governors who are usually elected individuals to oversee and enforce the rules and regulations of the HOA. The HOA typically states the rules and regulations in a document known as the Declaration of Covenants, Conditions, and Restrictions a.k.a CC&Rs. The CC&Rs require the owners to follow set conditions in relation to the maintenance of the properties in the community, especially structural restrictions such as type of landscape allowed, type of fences which can be chosen. The color of the paint for the house will also need the permission of the HOA. The CC&R document will also outline the protocol for breaching the guidelines via compliance by force, penalties, and lastly litigation.

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A good HOA that is run efficiently can be a joy to work with and this will eventually lead to an increase in property values. A poorly run HOA will lead to a lot of friction and turn into a networking nightmare. Another thing to keep in mind is that an HOA is distinctly different from a property owners association(POA). A POA is made up of a group of people who are looking to better their community and thereby raise the property values. A POA may include anyone in the community whose interests are to upkeep the community. POA’s may even include non home-owners.

Pros And Cons Of HOAs:

The pros of being in a HOA is that they set the rules and regulations which are enforced and thereby preserve and increase the value of the property. These rules are usually appearance related and oriented such as cleanliness, property condition, and future repairs if any. This ensures an uniform appearance for all the homes in the community under the HOA. The management of a HOA will also perform certain maintenance and upkeep like landscaping, trash removal, and snow removal. They also provide facilities like swimming pools, party halls and tennis courts. One of the best parts of being part of a HOA is self-autonomy – the people who live in the HOA are in charge of their community.

The cons of being in a HOA are the high fees associated with being a part of the HOA. The fees can add on and can act as a deterrent to potential home buyers. The rules and regulations can at times be too restrictive for some homeowners who may be interested in seeing some changes in their property. The Board of directors and other members may not know how to professionally run a HOA and this can cause a lot of conflicts among the members of the community.

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