Pros and Cons of Homeowners’ Associations

According to the U.S. Census Bureau, 59 percent of newly constructed homes in 2014 were part of a homeowners’ association, up from 46 percent in 2009. Clearly homeowner associations are here to stay.

There are not many HOAs in Washington, DC,Bethesda and Chevy Chase because the area was developed before HOAs came into popularity, but there are many HOAs further out in areas such as Rockville, Germantown, Manassas, or Centerville. If you are looking for a home in Montgomery County, you should consider whether you want a home in a homeowners’ association.

If you are thinking of buying new construction outside the Beltway, it is likely that you will be looking at a home in a homeowners association, but lots of resales also come with homeowner association rules and fees. There must be benefits to a homeowners’ association if so many developers choose to create them but what are the drawbacks?

Pro No. 1: You’ll enjoy access to amenities.

An HOA usually offers community amenities such as a pool, a fitness center, green spaces or parks, and children’s play areas.  It gives you a place to meet the neighbors and enjoy the extra amenities at less cost than a pool in your back yard!

Pro No. 2: Your neighborhood will always look good.

Generally, an HOA establishes rules to ensure the neighborhood looks good. These include strict guidelines about keeping lawns manicured, restrictions on parking boats and other large vehicles on the street, and limitations on exterior paint colors.  Your neighbor won’t be allowed to let his exterior deteriorate and affect your property value.


Pro No. 3: You can get to know your neighbors.

You can serve on the HOA board or are otherwise active in the association and become better acquainted with your neighbors.

Pro No. 4: Your maintenance costs will be shared.

Typically, some of the HOA dues go to maintenance of shared spaces. This includes community lawn care (but not for your own yard), community snow removal (but not for your own property) and upkeep of common areas like the pool or the fitness center.

Pro No. 5: You’ve got a built-in mediator.

You can settle some confrontations with your neighbors by taking your grievances to the HOA’s board or management company rather than dealing directly with the neighbor.  The HOA rules provide a frame of reference for resolution of issues like a barking dog or a tree overhanging a neighbor’s yard.

On the other side of the equation are the inevitable cons to an HOA.

Con No. 1:  You agree to pay HOA dues.

When buying a home in a community with an HOA, HOA dues become an annual or monthly budget item. The dues vary, but typically can run as high as several hundred dollars per month.  HOA fees are not as high however as condo dues. Before buying in an HOA you should look at the fees, the annual budget and whether there are any projected increases in the fees or whether there is an adequate reserve.

Con No. 2: You have to follow the rules too.

It is great that an HOA can prevent your neighbor from painting the house purple or raising chickens in the garage, but you have to follow the rules too. Any changes to the exterior of a home in an HOA community may have to be approved by the HOA.

Be sure to read the rules carefully to find out if you will need HOA Board approval to add a pool or a deck or change the paint color or your new home.  Some mandated style choices can be very expensive, such as a shake shingle roof that you may not want to continue to maintain.

Con No. 3: You might be impacted by an HOA’s financial woes.

If an HOA is facing financial problems or is ensnared in a lawsuit, it could harm your ability to obtain a loan for a home and could hurt sale prices of homes in the community.

Con No. 4: You might be the victim of a small board.

Problems can arise when homeowners stop attending HOA meetings and it’s left to a small group of people to make decisions.  If you want to have a say in how the HOA is run, then you need to serve on the Board.  Get involved.

If you are thinking of buying a home in the DC metro area, please give the Lise Howe Group a call! We will sit down with you over a cup of coffee and talk about your lifestyle, your wants and needs, and your budget and consider whether an HOA community is right for you. From there, we will start looking for that perfect home! The market is great and there are lots of choices for you.