Inflation is affecting everyone and your community may not be immune to it. But what does my payment cover? This is a frequent question many neighbors have. Buying a home in an HOA or homeowners association means you are part of a common interest development (CID). You share the cost of operating your community. Instead of paying the City or County taxes for the general upkeep of your neighborhood, you and your fellow neighbors share that responsibility.
Knowing that your Board of Directors determines your HOA fees is essential. Your board comprises volunteers and homeowners like you, who pay the fees like everyone else. The board determines the fee price by evaluating and preparing an annual budget outlining the expected cost for the entire community. Where does my homeowner's association fee go, you might be asking. Below is a brief description, but it is essential to understand that each community is unique, with various upkeep requirements outlined in your governing documents.
1. Utilities
These expenses may include street lights, sprinkler or irrigation water, internet, trash disposal, phone lines, or electricity to any gates or other amenities that require power. This all depends on the components your neighborhood has.
2. Maintenance Services
These expenses may include landscape services, trash pick up, lighting repairs, street repairs, street sweeping, janitorial services, street signs, painting, or any other applicable services to maintain the overall upkeep.
3. Professional Services
These expenses may include liability insurance, property insurance, worker's compensation, certified public accountants or bookkeeping services, legal fees, and management services.
4. Savings Account
All associations (HOAs) in CA must set money aside for major component replacements and renovations. Examples of components include your streets, sidewalks, light posts and fixtures, landscape trees, park benches, pools, gates, and many others. The more amenities or common areas you have, the bigger your savings account.
As you can see, your HOA fees are an investment in your community's future. For some, HOA fees can seem excessive. But they help keep your community financially healthy and beautiful, all of which help maintain your overall property values. To learn more about how we bring unity & transparency to thousands of neighbors, call us today. (833)HOA-1100.
