According to the U.S. Census Bureau, the average HOA fee runs residents $396 a year. This same research study also reveals that these numbers are on the rise.
So why exactly are homeowners required and willing to pay these extra costs? Well, we are here to help better answer that question.
Why are there HOA Fees for Condo Owners
Although homeowners are quick cringe at the word “fee”, the reality is that these expenses help maintain the upkeep of the neighborhood and quality of life for condo residents.
When people become condo owners, they also become automatic members of an HOA. With this membership comes monthly or annual dues to help fund the amenities and services the association provides.
HOAs also increase the exclusivity of condos, increasing the desirability of the property for current and future unit owners.
What do the Fees Pay For
Condo HOA fees may fund a wide variety of services and amenities. That is why it is crucial for prospective home buyers to investigate HOA policies before purchases to learn precisely what the dues cover.
Most HOA policies will cover basic services, such as building maintenance, landscaping, and garbage removal. Common amenities may also include a pool or gym.
Higher-end condominiums often utilize member fees to help fund luxury services and amenities. Today it is common for exclusive buildings to provide valet, a concierge desk, spas, and other resort-like features.
Naturally, the more services and amenities provided, the higher those monthly dues will cost unit owners.
A smaller portion of HOA fees goes towards the association’s administration, including legal, accounting, and management services.
What if you Don’t Pay the Fees?
So what happens if you miss a monthly fee?
While the repercussions may vary depending on what state you are in, there are basic penalties that the HOA will put into action.
First, be prepared to receive a letter reminding you of your outstanding debt immediately. The HOA may also add on a fine and/or interest on that missed payment.
Often, the HOA may also revoke homeowner rights. This may include taking away your privileges to vote on HOA matters or utilize common areas, such as a gym or pool.
To avoid these consequences, be sure to pay your fees in a timely manner; and if you do happen to miss a payment, make sure to keep open communication with your HOA board to resolve the issue and minimize penalties.
With a better understanding of condo HOA fees, we hope you feel more confident navigating your next home purchase! Experienced real estate brokers are also available to help make the process even smoother.