HOA management can be a confusing concept, especially for the uninitiated. After all, many responsibilities and tasks fall under it. What is HOA management, and what should homeowners’ associations and their members know about it? Let’s find out.
What Is HOA Management?
Homeowners associations (HOAs) have a wide range of responsibilities. They primarily exist to maintain property values. HOAs must maintain common areas, enforce the community’s rules, and manage the neighborhood’s daily operations to do this. Homeowners associations typically govern planned communities, condominiums, and subdivisions.
Meanwhile, homeowners association management involves the handling or governance of an HOA community. It covers all the activities that a homeowners association must fulfill. This includes financial management, HOA dues collection, common area upkeep, and vendor coordination.
In self-managed communities, the board of directors is responsible for HOA management. However, many neighborhood associations outsource most of these responsibilities to homeowner association management companies.
This frees up the board’s time as they are primarily made up of volunteers. It allows them to focus on important matters and make big community decisions. Moreover, it helps streamline community association management and makes it more efficient.
What Do HOA Management Companies Do?
If a community seeks help from an HOA management company, the responsibilities are often divided between the HOA manager and the board. This doesn’t mean the HOA management company takes over all of the board’s power. The board still has the authority to make community decisions.
Meanwhile, the HOA management company’s primary job is to oversee the HOA’s regular operations. They can supervise common area maintenance, track violations, and help with accounting or financial management.
The management company is the helping hand that helps the board fulfill its duties. Here are some examples of services HOA management companies provide:
- Insurance Management
- Legal advisory
- Vendor bid solicitation
- Maintenance and repairs supervision
- Regular community inspection
- Service request tracking
- Community functions and event organization
- Board meeting facilitation and attendance
- Meeting notification and agenda creation
- Minutes of the meeting recordation
- Board member advisory
- Invoice dissemination
- Assessment collection and payable management
- Board and HOA member communication
- Escrow assistance
- Monthly financial reports and statement preparation
Many of these companies have a seasoned expert team that provides all these services and more. However, whether the company provides a full range of services or only a few often depends on the package the community avails of.
Why Hire an HOA Management Company?
Professional HOA management can serve communities in many different ways. Here are some benefits that come with seeking help from a reputable management company:
- Knowledge and Expertise. HOA management companies often have the right people, skills, resources, and experience to fulfill all of an HOA’s responsibilities. They have financial experts, accountants, lawyers, and access to a list of reputable vendors.
- Delegation of Responsibilities. The HOA board comprises volunteers who might need more time to do everything. They also might lack the manpower even if they hire vendors and staff. Hiring an HOA management company helps the board juggle their workload and allows them to focus on decision-making.
- Clear Communication. HOA management companies often have the physical and digital resources to streamline communications. This allows HOA members to understand community rules and policies.
- Fairness. HOA management companies are third parties. Therefore, they can enforce the rules impartially as they don’t have ties to the community. This ensures each homeowner is given equal opportunity to be heard. Likewise, everyone will be penalized fairly.
- Increased Homeowner Satisfaction. Proper HOA management means everything is clear, streamlined, and efficient. This reduces the number of homeowner complaints and increases their satisfaction. Good management also means the board fulfills all its duties, including community maintenance. As a result, homeowners are satisfied with their living conditions.
How Much Are HOA Management Services?
HOA management can be costly if communities avail of full-service packages. Professional services can cost $10 to $20 per home monthly. However, this can change if a community avails of add-ons or only avails of a few services.
Moreover, many management companies impose other charges like exit and initiation fees. These can cover initial transition costs, start-up expenses, bookkeeping, and file transitions. They may also charge communities separately for extra services. For example, they may attend more than the required monthly meetings if the community pays extra.
Should You Consider Self-Management?
Self-managed HOAs are those that accomplish everything without hiring an HOA management company. This means the community utilizes the board, committees, and volunteers to do the work. They collect the fees, enforce rules, inspect the community, hire vendors, and manage meetings.
While this may be more difficult, self-management makes sense if the community is small. It’s also much cheaper because the community doesn’t need to pay a third party. The board members are often unpaid volunteers, so self-management doesn’t raise HOA dues.
However, it might only be viable for some communities. This is because the board members often have day jobs and roles in their homes. They will only sometimes have the time to dedicate themselves to community matters. As a result, the HOA might not be able to maintain common areas, enforce rules, or manage community meetings as efficiently.
In addition, the board may need the right expertise to fulfill all its duties. For example, they may not know accounting or financial management. HOAs also have many legal obligations to fulfill. This can be hard if the board doesn’t have legal help.
Ultimately, self-management may be best reserved for small communities. It may be hard for larger communities to self-manage as the responsibilities often scale with size. Nonetheless, there is no right or wrong answer to this question. It depends on your community’s needs, resources, and capabilities.
Hire an HOA Management Company Today
HOA management entails a lot of things. The board must check for violations, conduct reserve studies, collect dues, and hold regular meetings. Doing all these tasks yourself may be doable, but hiring a professional HOA management company can make things much easier.
Are you looking for an experienced HOA management company? Look no further than First Equity Property Management. We offer premier HOA and property management services around California. Call us today at 650.349.7233 or contact us online to know more!