Thinking of buying a house - HOA is $400/month

[FrugalSaver]

On one hand that sounds crazy. However, it includes insurance for all structural items and maintenance.

I’m getting more details on that but it sounds like what I have for my rentals where I as the owner pay insurance but my tenants pay insurance for their belongings inside.

That would make the HOA probably more like $200/month. Still not great but at the right price it may be a good investment in total.

Any experience with an HOA that covers these types of things and what I should watch out for?

[ecchastang]

Watch for HOA restrictions on non-owner occupancy. 

[SwordGuy]

Single family dwellings or a condo/townhouse with shared roof, walls, etc.


Recognize that if it's the latter you get to buy them a new roof if they default.   All the stuff they should have been covering you get to cover instead.   

Does the HOA have lots of $ reserves?    Because if it doesn't and something big happens, you'll get a big assessment due promptly and the HOA fee will go up.

And, of course, every fascist wannabee with some spare time will hanker to be on the board and be a pain in the ass to everyone.   You might get lucky and get reasonable board members but it's just a matter of time.

Your ability to make upgrades that you choose, or to do the work on your timeframe instead of the HOA's preferences, will be severely curtailed.

If your tenant violates the rules you may find yourself being fined.   

Google HOA Horror Stories.    There are gobs of them.   Some include the entire complex not having insurance because some board member screwed it up big time, which was discovered after the complex burned down.

No way in hell do I want anything to do with one.    Other people swear by them instead of at them.

[MilesTeg]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

[MishMash]

Oh hell no! Especially if it single family homes.  We were in a townhouse, in DC, it was 80 a month.  We recently moved to an HOA in fl of single family homes, it's 98 A YEAR.

[Catbert]

Make sure you understand what their provided insurance really covers.  IME it covers the shell of the building but not the fitting (e.g. kitchen cabinets and counter tops) nor does it cover your liability insurance.  What HOA covers will bring down the cost of your insurance quite a bit, but don't skip on getting a condo rental owner policy.

I've had a rental condo for many years and its worked out fine.  It's a well run, financially stable complex.  It expects people to fall the rules, but it more focused on correcting behavior than leveling fines.  I've never had a terrible tenant there, however, being in an HOA would add and extra layer of hell with a bad tenant who refuses to follow rules of pay resulting fines.

[bmjohnson35]

It's hard to comment without knowing the comparable costs in your area. HOA's have become very pervasive in Florida.  When we were shopping for our present home, we tried our best to avoid them.  We ended up with $90 a year for our 2700 sq ft townhouse to the community HOA.  $400 a month sounds high to me, but we intentionally tried to keep our cost of living as low as possible. We paid cash for our home and $400 a month covers our taxes, insurance, HOA, water and electric for the year. Lower cost of living helps during economy downturns and it frees up money for other costs. Once we retire, our vacation budget will be triple our housing costs.

It ultimately comes down to your own situation and priorities.

BJ

[use2betrix]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

[katcrews]

Some HOA's have a lot of restrictions. The complex next door to me says if you buy a home you have to own it for 1 year before you can start renting it out. then they have all kinds of rules about the renters. Definitely get with them to find out the HOA rules. You don't say where that is located. I am in florida and it is $273 a month which is high. Can't imagine where they are charging more.

[Zamboni]

$400 a month HOA for a single family home is absurd. What are they going to do . . . pave your development entry road in gold?

We have a single family home and the community has a community pool & park. The <$35/month HOA dues goes to upkeep of the pool, park, and other common areas (signs and lights at the development entrances, removing dead trees from common areas around the park, etc.)

[SeekingFIRE43]

Overall, I love townhome living. I like having someone else do all the yard work. That being said, you have to watch out for "special assessments" when you have an HOA. This is when they don't have enough money for something, so they make you pay extra money over a period of time to cover it. In my last townhome, we had to pay an extra $100 a month for 3 years to cover replacing our roofs because the HOA had not put aside enough money. There was no getting out of it. If you tried to sell your home, you needed to pay the balance on the special assessment before you could sell.

In my current home, HOA fee is only $90 a month. It only covers insurance on the external structure and lawn maintenance and common property maintenance. I've been here 5 years and have been very happy. HOA fees vary widely depending on what is covered and where you are located.

[SwordGuy]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

Take that attitude, multiply it x10, and imagine them checking out your property several times a week looking for eyesores to complain about and fine you over...

[MilesTeg]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

[use2betrix]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

[ender]

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Property taxes and city ordinances really are the worst, aren't they!

[ministashy]

Speaking as someone who is (very reluctantly) the president of my HOA, I would just like to point out that not all board members are fascist wannabes who go around measuring the length of your grass and fining you for perceived infractions.  Please keep in mind that HOA board members are fellow owners, like you, who are taking time out of their own busy schedules to deal with the nitty gritty BS and paperwork that comes with running an association (insurance, utility increases, maintenance requirements and wrangling recalcitrant contractors, budgets, etc.) often with little to no thanks from the rest of the property owners. 

That said, unless I'm in a situation where there's shared property (shared buildings a la a townhouse or condo, or a shared clubhouse, pool, parking areas, parkland, etc) that needs to be maintained, I'm not sure I'd ever buy a house that was part of an HOA.  That's a lot of extra legal hoopla for no real gain, IMHO. 

If there IS shared property, though, that HOA protects your investment from being trashed by inconsiderate neighbors (especially if it's a townhome or condo--it's amazing how much damage one small water leak can do in a shared building!)--as long as it's being run properly.  A few folks on this thread have mentioned very low HOA yearly/monthly fees--personally, I would be wary of any property that has super-low dues compared to equivalent properties, because that means they're not socking away enough money for potential emergencies/big maintenance costs down the road, and your changes of a special assessment are MUCH higher.  Make sure to look at the HOA's books--what do they have in reserves, and is it enough for projected maintenance needs?  Are they keeping up on the maintenance, and not just the cosmetic stuff?  You can also look at previous meeting minutes too, to get an idea of what the Board is like and what kind of decisions they've handed down.  In WA state, at least, all of this stuff has to be documented and given to prospective/new owners by the property manager. 

[Just Joe]

Those HOA horror stories are pretty horrible. Nope. An added layer of complexity to daily life. Perhaps necessary when cramming a bunch of people together in close quarters.

[MilesTeg]

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Property taxes and city ordinances really are the worst, aren't they!

Property taxes result in real, tangible, quantifiable benefits. Schools, fire departments, etc. HOAs (for detached homes) provide no quantifiable benefits.

City ordinances (which generally enforce the things people cry for HOAs about like weeds) don't have a penalty that includes possibly foreclosing on your home.

[MilesTeg]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

It's not a generalization at all. If you sign a contract with an HOA that gives them right of first lien on your property, that means you are signing over ownership of your home to the HOA and giving them the full legal authority to foreclose on your home to collect any debt you might have to them, even $0.01. Just like when you get a mortgage. Except at least the bank is doing something of real value for you by loaning you money.

[GodlessCommie]

Speaking as someone who is (very reluctantly) the president of my HOA, I would just like to point out that not all board members are fascist wannabes who go around measuring the length of your grass and fining you for perceived infractions.

Thanks for volunteering your time to help the neighborhood!

We live in an area with an HOA. Comparing with nearby neighborhoods with no HOA, or HOA in which residents don't actively participate, I definitely see value in ours. Our fees are reasonable, though: $73/mo, which pays for three pools, a decent size "private" nature reserve, and trash removal. To add to horror stories: we used to have a wannabe fascist as a member of the board, who used his position to settle personal scores. He was eventually voted out. We seem to have reasonable people now, and they always look for more committee members.

[mozar]

My hoa fee is 250 a month which is typical where I live. They do all structural things. They recently replaced my windows, base board heaters, exterior doors, and I paid to have insulation added where I paid for the materials and they did the work as part of the update. The board is stable, mostly retirees. We also get some perks like plumbing repair. My mom's hoa though is a total shit show. She had to pay a special assessment. People routinely lead insurrections and take over the board. They keep firing the management company so repairs are stopped in the middle constantly because the new mgmt co has to rebid everything. So do your research, but don't feel bad if you end up with a crappy hoa, there are worse things than having a repair delayed. My mom is still alive, it's not the end of the world.
I think the opposition on this forum has more to do with some people's libertarian streak than anything to do with actual hoas.

[EngagedToFIRE]

My experience with HOA's (in Florida) has been generally pretty darn good.  Yeah, if your roof is nasty, they will send you a letter asking to clean it.  But as long as you are generally not a dick who doesn't maintain their house, the HOA is rather invisible.  That is, enforcing stuff on you.  What you DO get with an HOA is a nicer neighborhood, sometimes gated, maintained playgrounds, common areas, and one home we had a lake that was maintained by the HOA, with dues a whopping $40/mo for quite a bit of amenities.  $400/mo is all relative.  It could be reasonable.  Many neighborhoods have nice pools, playgrounds, landscaping, etc.

[EngagedToFIRE]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

It's not a generalization at all. If you sign a contract with an HOA that gives them right of first lien on your property, that means you are signing over ownership of your home to the HOA and giving them the full legal authority to foreclose on your home to collect any debt you might have to them, even $0.01. Just like when you get a mortgage. Except at least the bank is doing something of real value for you by loaning you money.

Then don't have a debt to the HOA.  Also, try having a debt to your property tax collector... they'll take your house all the same.

[mistershankly]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

It's not a generalization at all. If you sign a contract with an HOA that gives them right of first lien on your property, that means you are signing over ownership of your home to the HOA and giving them the full legal authority to foreclose on your home to collect any debt you might have to them, even $0.01. Just like when you get a mortgage. Except at least the bank is doing something of real value for you by loaning you money.

Then don't have a debt to the HOA.  Also, try having a debt to your property tax collector... they'll take your house all the same.

I see what you're saying but it's not that cut and dry.  DW and I owned a condo and bath tub leaked to the owner below... no negligence, just a case of shit happens in a multi-unit building..  Owner below was grossly underinsured and refused to file a claim.  Being a known pain in the ass in the complex, he threatened to sue the HOA to pay for the damages.  HOA wanted to avoid dealing with him so they paid his damages and put a lien on our unit.  After hiring attorney and multiple letters back and forth, we settled partially with the HOA and sold the condo in days after that.  Not all HOA's are reasonable nor are the evolving leaders/members of the HOA sane or even remotely intelligent.  I will never live under an HOA again.  I will live in my car before I ever lived under an HOA again.

[EngagedToFIRE]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

It's not a generalization at all. If you sign a contract with an HOA that gives them right of first lien on your property, that means you are signing over ownership of your home to the HOA and giving them the full legal authority to foreclose on your home to collect any debt you might have to them, even $0.01. Just like when you get a mortgage. Except at least the bank is doing something of real value for you by loaning you money.

Then don't have a debt to the HOA.  Also, try having a debt to your property tax collector... they'll take your house all the same.

I see what you're saying but it's not that cut and dry.  DW and I owned a condo and bath tub leaked to the owner below... no negligence, just a case of shit happens in a multi-unit building..  Owner below was grossly underinsured and refused to file a claim.  Being a known pain in the ass in the complex, he threatened to sue the HOA to pay for the damages.  HOA wanted to avoid dealing with him so they paid his damages and put a lien on our unit.  After hiring attorney and multiple letters back and forth, we settled partially with the HOA and sold the condo in days after that.  Not all HOA's are reasonable nor are the evolving leaders/members of the HOA sane or even remotely intelligent.  I will never live under an HOA again.  I will live in my car before I ever lived under an HOA again.

So, YOUR bathtub damaged someone else's unit and you are upset that they didn't file insurance claims and do everything the way YOU demanded them?  Why didn't you have insurance to cover this damage?  You got to the point of hiring an attorney over this?  Why didn't you just fix the damage YOU caused?  This is insane.  What point are you trying to make?  If you damage your neighbors unit, refuse to pay for it, the HOA puts a lein on your house because you are refusing to fix what you damaged, then you have debt to the HOA?  Lol... yeah, no shit.  Your story kind of proves it works the way it's supposed to, doesn't it?  The HOA stepped in and fixed the issue for this poor guy dealing all the damage you caused, and then put a lein on your house to recover the damages that YOU caused.  Sounds like a great place to live and entirely reasonable.  They are probably thrilled that you moved.

[Dicey]

$400 a month HOA for a single family home is absurd. What are they going to do . . . pave your development entry road in gold?

We have a single family home and the community has a community pool & park. The <$35/month HOA dues goes to upkeep of the pool, park, and other common areas (signs and lights at the development entrances, removing dead trees from common areas around the park, etc.)

I find answers like this well-intentioned, but really frustrating, and also a gateway to my answer. What you should commit to depends on what is the norm for your area. If you can find a deal like the one outlined in Zamboni's answer, then great! Go for it, but only if it's at or below the norm for the area. And you must investigate the fiscal health of the HOA. Remember that any property within an HOA can be hit by a special assessment, no matter how low the dues are. And HOA dues virtually always go up.* Count on it, and plan for it.

Another thing to know is that HOA fees can serve as an anchor to resale value. In your shoes, I would challenge myself to see what else is out there and make sure you're getting the most bang for your hard-earned buck. Also, be sure to compare like to like. What does each HOA include? If it includes all utilities, insurance, landscaping, building maintenance and a decent assortment of amenities, it could be worth it, but only if it's at or below local comps.

True story: We have rentals in a Senior Community. A few years before we met them, our now-favorite tenants bought a retirement home in a fancy golf course community because he loved to play golf. Eventually, he got to the point he couldn't play any more and didn't care that his luxurious country club townhome was on the golf course. They put the townhome on the market and sold it for a loss, due to the outrageous HOA. He then rented our place, in a community with two golf courses, but a pay-as-you-play program. His entire rent, for a similarly sized home with more amenities, is less than the HOA fee alone was at their old place.

He and my husband have really hit it off, and they chat often. Every time, he tells my husband how much they love the house and marvel over how much less it's costing them. DH always offers to sell them the house and/or raise their rent. They all laugh, but it's a steady reminder to us to be careful what you are committing to when you buy into an HOA. We do not love the one we have, but the costs are far less than the surrounding area, and we're able to attract high-quality tenants, so we put up with it.

One more thought: If you do buy anywhere, plan on attending meetings and eventually getting on the board. In one place I lived, there was a special assessment proposed to replace the roofs. I asked if they all had to be done at once. The roofer's assessment was that we could do two per year for three years. Result? The subsequent years were easier to do because of what they learned with the first two roofs, which lowered costs even more. The HOA was able to cash flow the project, eliminating the need for a special assessment. All because I was on the board and asked the question. I was terrified of having to pay the special assessment, which would have been about 4-5 months of mortgage payments. That alone was worth every minute spent being on the HOA Board, plus I got to know a lot of my neighbors, for the win.

*On another HOA board, we were so well funded that we lowered the dues slightly one year and skipped the annual increase the next year. Would you believe some people were upset? Can't please everyone, no matter what you do.

[mistershankly]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

It's not a generalization at all. If you sign a contract with an HOA that gives them right of first lien on your property, that means you are signing over ownership of your home to the HOA and giving them the full legal authority to foreclose on your home to collect any debt you might have to them, even $0.01. Just like when you get a mortgage. Except at least the bank is doing something of real value for you by loaning you money.

Then don't have a debt to the HOA.  Also, try having a debt to your property tax collector... they'll take your house all the same.

I see what you're saying but it's not that cut and dry.  DW and I owned a condo and bath tub leaked to the owner below... no negligence, just a case of shit happens in a multi-unit building..  Owner below was grossly underinsured and refused to file a claim.  Being a known pain in the ass in the complex, he threatened to sue the HOA to pay for the damages.  HOA wanted to avoid dealing with him so they paid his damages and put a lien on our unit.  After hiring attorney and multiple letters back and forth, we settled partially with the HOA and sold the condo in days after that.  Not all HOA's are reasonable nor are the evolving leaders/members of the HOA sane or even remotely intelligent.  I will never live under an HOA again.  I will live in my car before I ever lived under an HOA again.

So, YOUR bathtub damaged someone else's unit and you are upset that they didn't file insurance claims and do everything the way YOU demanded them?  Why didn't you have insurance to cover this damage?  You got to the point of hiring an attorney over this?  Why didn't you just fix the damage YOU caused?  This is insane.  What point are you trying to make?  If you damage your neighbors unit, refuse to pay for it, the HOA puts a lein on your house because you are refusing to fix what you damaged, then you have debt to the HOA?  Lol... yeah, no shit.  Your story kind of proves it works the way it's supposed to, doesn't it?  The HOA stepped in and fixed the issue for this poor guy dealing all the damage you caused, and then put a lein on your house to recover the damages that YOU caused.  Sounds like a great place to live and entirely reasonable.  They are probably thrilled that you moved.

Settle down.  I did file a claim.  California law is what I was following.  Again, settle down cowboy/cowgirl and do your homework about HOA, liability, damages within walls between units, and claims regarding non-negligent occurrences before going off like a child.

[MilesTeg]

The only circumstance where and HOA is of any valid use is if there is truly shared property (i.e. a condo or townhome or other multi-unit dwelling).

In any other circumstance you are signing away the ownership of your property to the HOA and stand to gain exactly zero from that arrangement.

Well... they also enforce rules, such as not having 1’ tall grass, a dozen cars in their driveway and the street, and all sorts of other aimless garbage that tons of home owners seem to cling to..

I live near a neighborhood I like with pretty homes. However, there’s clearly no HOA as every few homes is just some disgusting eye sore. Might be fine to some people, but it would bother me.

It you want an HOA be my guest.

Giving someone ownership of your home and the power to take it all away from you, with no legal recourse, over petty fines is the very definition of insanity to me.

Talk about a sweeping generalization.. That is insanity...

It's not a generalization at all. If you sign a contract with an HOA that gives them right of first lien on your property, that means you are signing over ownership of your home to the HOA and giving them the full legal authority to foreclose on your home to collect any debt you might have to them, even $0.01. Just like when you get a mortgage. Except at least the bank is doing something of real value for you by loaning you money.

Then don't have a debt to the HOA.  Also, try having a debt to your property tax collector... they'll take your house all the same.

This strikes me as a particularly naive statement. It assumes that all 'debts' you might incur to and HOA are valid. They are not (see all the many examples referenced in earlier posts). Incompetence and malice are rife in these types of organizations.

But even in the event that you do find yourself with a valid debt to an HOA, the terms a typical HOA has for debt collection are absurd.

Tell me, what other part of your life would you sign a contract that allowed for damages to be collected that were as much as 10,000-1,000,000 times the value of the violation? Especially when some of those violations are explicitly subjective in quality (i.e. the all too frequent  'meets community standards' clauses)

[Larsg]

The thing to remember about HOA's is that they always go one direction just like your taxes...UP. And then over time, you add your HOA + your Property Taxes and by the time you retire, you'll be paying "rent" like payments on a hours you already own. Also, the HOA does not eliminate the need to still maintain things and then you have to deal with the issue of most HOA's being over governed and then special assessments that come along every couple years. Then if the economy goes south and or any individual unit owner is unable to pay, the costs of the HOA + Special assessments will get spread among all those that remain.

We did this one time, quickly realized our mistake, sold out of it and will not ever do it again under any circumstance. They start out at 4, in 2 years it will be 475, 3 years, 5, 5 years 6...not to mention the Monsanto chemicals going into all that weed free, high maintenance lawn that goes into your water supply. You can fight for your own patch - and it will be a constant fight - but you will absorb the pollution from all the others that HAFTA HAVE their green lawns, artificially stoked up flowers, and so on.

Good Luck.

[jlcnuke]

I don't do any HOA that has a significant fee, strict rules, OR the ability to adjust the rules and/or prices in the future. Too many people have been burned by those things.

[hadabeardonce]

Any experience with an HOA that covers these types of things and what I should watch out for?

If it makes you feel any better, my HOA charges $511/mo for a 660sqft 1b/1ba condo in the SF Bay Area(South Bay near the Apple Spaceship.)

On the "plus side" I've had a stable place to live since 2004 and my living expenses are lower than what people are paying for a comparable place today. I have $280k in equity according to Zillow.

On the "negative side" multi-unit living sucks. As I write this I can hear my neighbors walking in their (rented)unit above me. The owner upstairs died years ago and an investor bought the place to rent out. The old guy used to flood our place pretty regularly... clogged toilet, defrosting chicken in the sink... I think it happened 3 or 4 times.

I have one deeded uncovered carport. My car has been broken into once and the storage unit above it has been broken into twice. I can't work on my car where I live. I can't leave at night and expect to find an open parking space when I return. The past few years I've been commuting by bicycle, so it's not such a huge issue anymore. Parking is also so bad that I can't have company over.

If there were ever a disaster that damaged part of the properly, a simple majority could vote to demolish the whole complex, sell and split the sales price amongst the 477 owners - even if my unit wasn't one of the ones that was ruined.

I could "wish" all day long for something different. At some point I'll make a move... maybe buy a duplex. My best advice would be to picture what your life would be like in that space and really consider how satisfied you would be with it. Weigh your options and enjoy living life.

[ministashy]

As a counterpoint to all the negative Nellies out there:

For any kind of shared complex (townhomes, condos, etc), your HOA dues ensure that:

You never have to worry about resealing or re-asphalting the parking lot.  Or striping, for that matter.
You never have to worry about mowing the lawn or any of the other tasks of grounds maintenance
Depending on the complex, you likely don't have to worry about water bills, sewer bills, or garbage bills (my dues cover all three--all of which do go up on a regular basis, much like contractor/maintenance prices go up, for those of you kvetching about how HOA dues 'always go up')
If a tree falls on your building, you don't have to worry about shelling out multiple thousands for the repair (unless your HOA is really crappy and kept your dues artificially low--yet another reason to actually pay attention to your association finances)
You don't have to pay out of pocket for pest control, repainting of buildings, or any of the other thousand and one things that come along with traditional home ownership.
You actually have recourse against neighbors violating HOA rules (partying all night, setting up a marijuana grow operation in their unit, deciding to start up their own little mechanic biz in their parking spot) that doesn't involve calling the police and hoping they'll do something.  Depending on how good the board is at enforcement of the HOA rules, those fines can mean the difference between a relatively peaceful existence and a rotating cast of party renters and other problem neighbors all around you.

Now in exchange for all this, you do give up unilateral control of your property--you are not the sole owner of your unit so much as a part owner in a multi-thousand or even million dollar shared property.  A lot of people don't like that idea, and if so, condo living is not for you.  But if you don't mind the tradeoffs, and are willing to do your homework (or even be that rare individual who puts in the time to be on the Board and keep it on an even keel), then HOAs are not inherently evil.

Again, like I mentioned before, the equation changes if you have a standalone home and are part of an HOA--the benefits on that are a bit more murky, IMHO.  But for any kind of shared property, HOAs are essential, and dues a necessary evil.

[mm1970]

The thing to remember about HOA's is that they always go one direction just like your taxes...UP. And then over time, you add your HOA + your Property Taxes and by the time you retire, you'll be paying "rent" like payments on a hours you already own. Also, the HOA does not eliminate the need to still maintain things and then you have to deal with the issue of most HOA's being over governed and then special assessments that come along every couple years. Then if the economy goes south and or any individual unit owner is unable to pay, the costs of the HOA + Special assessments will get spread among all those that remain.

We did this one time, quickly realized our mistake, sold out of it and will not ever do it again under any circumstance. They start out at 4, in 2 years it will be 475, 3 years, 5, 5 years 6...not to mention the Monsanto chemicals going into all that weed free, high maintenance lawn that goes into your water supply. You can fight for your own patch - and it will be a constant fight - but you will absorb the pollution from all the others that HAFTA HAVE their green lawns, artificially stoked up flowers, and so on.

Good Luck.

I bought my house in CA in 2004, and my property taxes went down many years in a row due to reassessments.

[Car Jack]

I'm quite happy not having an HOA or as I call it, the timeshare of housing.  For the 4 times a year I have to mow the lawn and the added expense of owning a snowplow and some chainsaws, I'll take the ability to do pretty much whatever the hell I want to with my house (so long as DW approves) over some HOA telling me that I can't stack firewood next to my house or that my Jeep must be fully inside the garage with the door closed.

[EricEng]

I've lived in three areas with three HOAs.  None of them were evil or invasive.  I also enjoyed attending their board meetings which anyone could attend to see what was being decided, very transparent.  Lot of these horror stories are from things on the internet or people that were jerks to their neighbors.  It is extremely rare to see a neighborhood built in the last 15 years without an HOA.

My current one provides parks, rec centers, pool, street lights, and some sidewalk clearing for their fees.

[Laura33]

$400 in and of itself is meaningless.  The real question is (1) what does the $400 cover, and (2) does it provide $400 of value to you?

Clearly, if you think all HOAs are bloodsucking monsters, then no amount of money is sufficient, and you should move on.*  But putting that aside, look at your condo documents and amenities and see what is included.

-- If you have a pool or golf course or playground or whatever, that is obvious, so what is that worth to you?
-- Do you have less visible amenities, like streetlights, ponds, snow removal, lawn maintenance, etc.?  What's that worth to you?
-- And then the really hidden stuff:  what kind of maintenance/replacement/other costs does the HOA cover that you would otherwise have to handle yourselves?  For ex., we have a condo in a community where the HOA is responsible for roofing, siding, windows, and plumbing to the unit, along with trash removal and of course power/water for exterior uses.  That kind of scenario is worth a lot more in fees than a situation where you are responsible for repairing your own roofing or siding leaks and have to deal with your own water/sewer lines to the street. 

For me, I mentally divide the HOA fee into different pots.  The first pot is "stuff I'd have to pay for no matter where I live" -- that includes things like a slush fund for maintenance and repairs, any kind of exterior maintenance/yardwork I don't want to deal with myself, insurance for stuff that the HOA covers, etc.  Then the second pot is all the extras -- pools, trails, ponds, whatever, along with the overhead associated with running the HOA.  The more that falls in the first pot, and the closer the second pot is to what you'd be willing to pay to have access to those amenities, the more worth it those fees will be to you.

*I am working really, really hard not to engage on this point, because I have given hundreds of hours of my life and tens of thousands of dollars in free legal work to my HOA as a board member, including spending over five years trying to collect unpaid condo fees from one owner who refuses to pay and who has followed a strategy of "run up the HOA's legal costs so they have to drop the suit."  So all I will say is that it goes both ways, and you need both a reasonable HOA and reasonable neighbors to make things work smoothly and keep costs down.

[Just Joe]

On point, @SwordGuy .  See also (for horror stories and lists of examples of how it can all go wrong): reddit.com/r/fuckhoa 

I have a lawyer friend who says the #1 thing people always ask him about is how to sue their HOA/HOA president/HOA management company, etc.  There's a whole scummy business for subpar companies who capture HOAs and drain their funds while doing little/no work (but giving plenty of kickbacks to the HOA pres).

You mean work like fake maintenance? Just curious.

[norajean]

HOA value depends on what you get for it.

We pay $200/mo but we get huge value for it - sparkling pools, tennis, riding trails, hiking, conference center, recital hall, picnic areas, security patrol, brush management, water and the list goes on.

We can't paint our house neon pink or park a boat in the yard, but neither can our neighbors so that works out ok.

[Kl285528]

remember too that the HOA fee is payable whether you have a vacancy or not - can be a drag on returns if a rental - and yes be very clear on rental restrictions - some HOA's in my area prohibit rentals entirely, or cap them at a percent of units that are under the HOA (which you have no control over) - this can be a killer - also, if HOA covers utilities for each unit, leads to higher utilities overall because incentive to be conservative with usage is much lower

[EngagedToFIRE]

As a counterpoint to all the negative Nellies out there:

For any kind of shared complex (townhomes, condos, etc), your HOA dues ensure that:

You never have to worry about resealing or re-asphalting the parking lot.  Or striping, for that matter.
You never have to worry about mowing the lawn or any of the other tasks of grounds maintenance
Depending on the complex, you likely don't have to worry about water bills, sewer bills, or garbage bills (my dues cover all three--all of which do go up on a regular basis, much like contractor/maintenance prices go up, for those of you kvetching about how HOA dues 'always go up')
If a tree falls on your building, you don't have to worry about shelling out multiple thousands for the repair (unless your HOA is really crappy and kept your dues artificially low--yet another reason to actually pay attention to your association finances)
You don't have to pay out of pocket for pest control, repainting of buildings, or any of the other thousand and one things that come along with traditional home ownership.
You actually have recourse against neighbors violating HOA rules (partying all night, setting up a marijuana grow operation in their unit, deciding to start up their own little mechanic biz in their parking spot) that doesn't involve calling the police and hoping they'll do something.  Depending on how good the board is at enforcement of the HOA rules, those fines can mean the difference between a relatively peaceful existence and a rotating cast of party renters and other problem neighbors all around you.

Now in exchange for all this, you do give up unilateral control of your property--you are not the sole owner of your unit so much as a part owner in a multi-thousand or even million dollar shared property.  A lot of people don't like that idea, and if so, condo living is not for you.  But if you don't mind the tradeoffs, and are willing to do your homework (or even be that rare individual who puts in the time to be on the Board and keep it on an even keel), then HOAs are not inherently evil.

Again, like I mentioned before, the equation changes if you have a standalone home and are part of an HOA--the benefits on that are a bit more murky, IMHO.  But for any kind of shared property, HOAs are essential, and dues a necessary evil.

Good post.  The thing with an HOA, is that you aren't paying for anything that you don't get.  The question is whether you want to pay for those amenities.  The HOA's themselves are non-profit with volunteers on the boards.  Every item is budgeted and paid for and you/the community receives that product or service.  Honestly, I don't understand the hatred of HOA's.  It's totally optional.  If you want the amenities, then you pay for them.  If you don't, then buy in a different neighborhood.  We pay a stupid amount in HOA fees, $6k/yr for a single family home.  And we don't get all that much, actually.  But it's expensive because we are a small neighborhood (a few dozen large houses) with 24/7 security and gates.  It's worth it to us and the residents that live here.  Would I feel that way in a different part of the country?  Maybe not.  But where we live, it's a feature that has value.  I also knew the price before I bought and reviewed the numbers.  I felt the expenses were justified and that's just kind of what it cost.  Some people buy a Tesla and think it's worth it. We pay for security.  It's all good.

[MilesTeg]

As a counterpoint to all the negative Nellies out there:

For any kind of shared complex (townhomes, condos, etc), your HOA dues ensure that:

You never have to worry about resealing or re-asphalting the parking lot.  Or striping, for that matter.
You never have to worry about mowing the lawn or any of the other tasks of grounds maintenance
Depending on the complex, you likely don't have to worry about water bills, sewer bills, or garbage bills (my dues cover all three--all of which do go up on a regular basis, much like contractor/maintenance prices go up, for those of you kvetching about how HOA dues 'always go up')
If a tree falls on your building, you don't have to worry about shelling out multiple thousands for the repair (unless your HOA is really crappy and kept your dues artificially low--yet another reason to actually pay attention to your association finances)
You don't have to pay out of pocket for pest control, repainting of buildings, or any of the other thousand and one things that come along with traditional home ownership.
You actually have recourse against neighbors violating HOA rules (partying all night, setting up a marijuana grow operation in their unit, deciding to start up their own little mechanic biz in their parking spot) that doesn't involve calling the police and hoping they'll do something.  Depending on how good the board is at enforcement of the HOA rules, those fines can mean the difference between a relatively peaceful existence and a rotating cast of party renters and other problem neighbors all around you.

Now in exchange for all this, you do give up unilateral control of your property--you are not the sole owner of your unit so much as a part owner in a multi-thousand or even million dollar shared property.  A lot of people don't like that idea, and if so, condo living is not for you.  But if you don't mind the tradeoffs, and are willing to do your homework (or even be that rare individual who puts in the time to be on the Board and keep it on an even keel), then HOAs are not inherently evil.

Again, like I mentioned before, the equation changes if you have a standalone home and are part of an HOA--the benefits on that are a bit more murky, IMHO.  But for any kind of shared property, HOAs are essential, and dues a necessary evil.

Good post.  The thing with an HOA, is that you aren't paying for anything that you don't get.  The question is whether you want to pay for those amenities.  The HOA's themselves are non-profit with volunteers on the boards.  Every item is budgeted and paid for and you/the community receives that product or service.  Honestly, I don't understand the hatred of HOA's.  It's totally optional.  If you want the amenities, then you pay for them.  If you don't, then buy in a different neighborhood.  We pay a stupid amount in HOA fees, $6k/yr for a single family home.  And we don't get all that much, actually.  But it's expensive because we are a small neighborhood (a few dozen large houses) with 24/7 security and gates.  It's worth it to us and the residents that live here.  Would I feel that way in a different part of the country?  Maybe not.  But where we live, it's a feature that has value.  I also knew the price before I bought and reviewed the numbers.  I felt the expenses were justified and that's just kind of what it cost.  Some people buy a Tesla and think it's worth it. We pay for security.  It's all good.

The idea that HOAs are optional is a myth. Until/unless you can readily purchase an equivalent HOA or non-HOA property they will continue to be something that is forced on people.

By equivalent I mean location, construction year, school district access, etc. In our town the only non-HOA properties are out of the city and/or 40+ year old construction in the extremely expensive parts of town.

Put another way, the only way we can buy an energy efficient home not filled with asbestos, lead and other hazards; that is in walking/biking distance to work; that is in a good school district for a reasonable price is to submit to the insanity of signing ownership of our property over to an organization that by its very nature attracts people that want to stick their nose where it doesn't belong.

[Dicey]

As a counterpoint to all the negative Nellies out there:

For any kind of shared complex (townhomes, condos, etc), your HOA dues ensure that:

You never have to worry about resealing or re-asphalting the parking lot.  Or striping, for that matter.
You never have to worry about mowing the lawn or any of the other tasks of grounds maintenance
Depending on the complex, you likely don't have to worry about water bills, sewer bills, or garbage bills (my dues cover all three--all of which do go up on a regular basis, much like contractor/maintenance prices go up, for those of you kvetching about how HOA dues 'always go up')
If a tree falls on your building, you don't have to worry about shelling out multiple thousands for the repair (unless your HOA is really crappy and kept your dues artificially low--yet another reason to actually pay attention to your association finances)
You don't have to pay out of pocket for pest control, repainting of buildings, or any of the other thousand and one things that come along with traditional home ownership.
You actually have recourse against neighbors violating HOA rules (partying all night, setting up a marijuana grow operation in their unit, deciding to start up their own little mechanic biz in their parking spot) that doesn't involve calling the police and hoping they'll do something.  Depending on how good the board is at enforcement of the HOA rules, those fines can mean the difference between a relatively peaceful existence and a rotating cast of party renters and other problem neighbors all around you.

Now in exchange for all this, you do give up unilateral control of your property--you are not the sole owner of your unit so much as a part owner in a multi-thousand or even million dollar shared property.  A lot of people don't like that idea, and if so, condo living is not for you.  But if you don't mind the tradeoffs, and are willing to do your homework (or even be that rare individual who puts in the time to be on the Board and keep it on an even keel), then HOAs are not inherently evil.

Again, like I mentioned before, the equation changes if you have a standalone home and are part of an HOA--the benefits on that are a bit more murky, IMHO.  But for any kind of shared property, HOAs are essential, and dues a necessary evil.

Good post.  The thing with an HOA, is that you aren't paying for anything that you don't get.  The question is whether you want to pay for those amenities.  The HOA's themselves are non-profit with volunteers on the boards.  Every item is budgeted and paid for and you/the community receives that product or service.  Honestly, I don't understand the hatred of HOA's.  It's totally optional.  If you want the amenities, then you pay for them.  If you don't, then buy in a different neighborhood.  We pay a stupid amount in HOA fees, $6k/yr for a single family home.  And we don't get all that much, actually.  But it's expensive because we are a small neighborhood (a few dozen large houses) with 24/7 security and gates.  It's worth it to us and the residents that live here.  Would I feel that way in a different part of the country?  Maybe not.  But where we live, it's a feature that has value.  I also knew the price before I bought and reviewed the numbers.  I felt the expenses were justified and that's just kind of what it cost.  Some people buy a Tesla and think it's worth it. We pay for security.  It's all good.

The idea that HOAs are optional is a myth. Until/unless you can readily purchase an equivalent HOA or non-HOA property they will continue to be something that is forced on people.

By equivalent I mean location, construction year, school district access, etc. In our town the only non-HOA properties are out of the city and/or 40+ year old construction in the extremely expensive parts of town.

Put another way, the only way we can buy an energy efficient home not filled with asbestos, lead and other hazards; that is in walking/biking distance to work; that is in a good school district for a reasonable price is to submit to the insanity of signing ownership of our property over to an organization that by its very nature attracts people that want to stick their nose where it doesn't belong.

Then join the board and be the change.

[MilesTeg]

Then join the board and be the change.

Ahh yes. Buy a home and hope and pray you can fix the HOA madness.

This does not produce  a real choice as I have mentioned.

[EngagedToFIRE]

As a counterpoint to all the negative Nellies out there:

For any kind of shared complex (townhomes, condos, etc), your HOA dues ensure that:

You never have to worry about resealing or re-asphalting the parking lot.  Or striping, for that matter.
You never have to worry about mowing the lawn or any of the other tasks of grounds maintenance
Depending on the complex, you likely don't have to worry about water bills, sewer bills, or garbage bills (my dues cover all three--all of which do go up on a regular basis, much like contractor/maintenance prices go up, for those of you kvetching about how HOA dues 'always go up')
If a tree falls on your building, you don't have to worry about shelling out multiple thousands for the repair (unless your HOA is really crappy and kept your dues artificially low--yet another reason to actually pay attention to your association finances)
You don't have to pay out of pocket for pest control, repainting of buildings, or any of the other thousand and one things that come along with traditional home ownership.
You actually have recourse against neighbors violating HOA rules (partying all night, setting up a marijuana grow operation in their unit, deciding to start up their own little mechanic biz in their parking spot) that doesn't involve calling the police and hoping they'll do something.  Depending on how good the board is at enforcement of the HOA rules, those fines can mean the difference between a relatively peaceful existence and a rotating cast of party renters and other problem neighbors all around you.

Now in exchange for all this, you do give up unilateral control of your property--you are not the sole owner of your unit so much as a part owner in a multi-thousand or even million dollar shared property.  A lot of people don't like that idea, and if so, condo living is not for you.  But if you don't mind the tradeoffs, and are willing to do your homework (or even be that rare individual who puts in the time to be on the Board and keep it on an even keel), then HOAs are not inherently evil.

Again, like I mentioned before, the equation changes if you have a standalone home and are part of an HOA--the benefits on that are a bit more murky, IMHO.  But for any kind of shared property, HOAs are essential, and dues a necessary evil.

Good post.  The thing with an HOA, is that you aren't paying for anything that you don't get.  The question is whether you want to pay for those amenities.  The HOA's themselves are non-profit with volunteers on the boards.  Every item is budgeted and paid for and you/the community receives that product or service.  Honestly, I don't understand the hatred of HOA's.  It's totally optional.  If you want the amenities, then you pay for them.  If you don't, then buy in a different neighborhood.  We pay a stupid amount in HOA fees, $6k/yr for a single family home.  And we don't get all that much, actually.  But it's expensive because we are a small neighborhood (a few dozen large houses) with 24/7 security and gates.  It's worth it to us and the residents that live here.  Would I feel that way in a different part of the country?  Maybe not.  But where we live, it's a feature that has value.  I also knew the price before I bought and reviewed the numbers.  I felt the expenses were justified and that's just kind of what it cost.  Some people buy a Tesla and think it's worth it. We pay for security.  It's all good.

The idea that HOAs are optional is a myth. Until/unless you can readily purchase an equivalent HOA or non-HOA property they will continue to be something that is forced on people.

By equivalent I mean location, construction year, school district access, etc. In our town the only non-HOA properties are out of the city and/or 40+ year old construction in the extremely expensive parts of town.

Put another way, the only way we can buy an energy efficient home not filled with asbestos, lead and other hazards; that is in walking/biking distance to work; that is in a good school district for a reasonable price is to submit to the insanity of signing ownership of our property over to an organization that by its very nature attracts people that want to stick their nose where it doesn't belong.

Then move to another town.  Everything you mentioned is optional.  It's like complaining that you live in a Red or Blue State.  "I can't find a house in Los Angeles that is in a State with a Republican governor"  Kind of ridiculous, right?