I'll keep it short as to not get into a rant over this but I really would like some advice from others that are part of an HOA.
Closed on a townhome December 13, 2016. The HOA has not reached out in regard to fees, coverage, and known issues. Luckily, the home I purchased is new construction from the foundation up so no issues need to be addressed. However, most all neighboring units are in severe disrepair. Molding and trim so rotted it's hanging from the structure, some units upstairs balcony's are drooping excessively and, appear to be unsafe. All the units are covered in wood siding and on many of the others, the planks are peeling back off the structure due to neglect and some have even fallen off exposing the underside. I say this because the HOA stipulates exterior maintenance/coverage. It also supplies blanket insurance for the units, and handles the landscaping. There are no pools, entertainment areas, or community spaces. Just the small patches of lawn in the front and back of each unit.
So I had a conversation with one of the neighbors regarding the HOA and he had some shocking things to say. He's been living there since 2014 and is active in the HOA meetings which happen 1-3 times per year. When I asked why none of these structures have been kept up to date he said, "well, we had a management company back before I moved in that had some shady dealings and pretty much walked out and took all the dues that were being collected. He said the HOA spent a crap ton of money in lawyer fees and never did get the money back that this management company swindled. He said back when he moved in the HOA fees were 132.00 per month. Currently they are 209.00. When I asked him why such large increases his response was that The HOA was increasing the fees every year since they had no money. This of course, is why they have not did any repairs on the units. This has been going on since 2014 as far as he knows (since when he moved in). He said they are now out of debt and have pooled some money to "eventually" start repairs to the units. When? Who knows. However the HOA is still collecting dues and not addressing issues. As well as the fact that if they have gotten out of debt, the HOA fees should decline. But the trend doesn't seem to be slowing down. They just raised them again last month.
Here are some questions I have if anyone can provide information before I start a wild goose chase with the HOA:
1. Because of all I've heard, I don't believe they are appropriating funds accordingly, and I feel I have legal rights to see how the funds are being spent. Do I have a right to demand/request annual/monthly itemization reports on the collection and spending of dues?
2. As I said earlier, they just raised the HOA again from 167.00 to 209.00 sometime around December 07, 2016. My mortgage contract regarding the HOA portion states 167.00. However, I have a sickening feeling whenever they do reach out to me for dues that they are going to try to charge 209.00. Does my mortgage contract cover me, for at least 2017 before they can demand a higher amount?
3. This one is not really a question as it is more of a concern...our budget doesn't allow for these sharp increases. Yes, I knew the HOA can and most likely would go up over time, but I presumed it would be few and far between, and certainly not the maximum amount allowed by law each and every year. Granted, these increases could stop next year for all I know, but as of now, they have been doing this every year for the past 3 1/2 years. I don't know if this is unwarranted, but my lifetime maximum budget for this HOA is 400.00. That, over time, and my property tax payment (once mortgage is paid off in 15 yrs) would be hovering around 600.00 a month. It's a broad generalization, but if those two payments ever exceed that ball park figure, I will have to sell or rent out the unit because at that rate, I can rent at a cheaper price. Right now, and as far as my projections go, my mortgage is cheaper than renting where I live. I just didn't think I could potentially be "priced out" so quickly, at least not until the mortgage was paid off.