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Home Ownership

Do I Need An HOA?

By April 29, 2021May 4th, 2021No Comments

What is an HOADo I Need An HOA?

People love to hate HOAs, but oftentimes they don’t realize they actually want everything an HOA provides. HOAs face criticism from individuals who don’t like an organization to dictate what they can and can not do with a property they own. Sometimes people are wary of living under bylaws that may come with fines for violations. 

HOAs may not be for everyone, but the positives usually outweigh the negatives. And as with anything, if you have a better understanding of it, you appreciate it more. So we’ve got a list of reasons why you should love your HOA and a breakdown of HOA fees for home buyers. 

Why You Should Love Your HOA

  • HOAs Provide More Services Than The City– An HOA will pay for exclusive services that exceed those provided by the city. They supply essential maintenance, keep the community safer, and aid in beautification.
  • HOAs Stabilize Property Values– One of the main functions of an HOA is to prevent property values from declining. The additional services and upkeep that the HOA maintains can keep a neighborhood looking its best over long periods. This strengthens your property value as well. 
  • HOAs Provide Recreational Amenities– If you love spending time outdoors in beautiful spaces and the idea of well-maintained playgrounds, parks, walking/jogging trails, tennis courts, and pools, then you should be your HOAs biggest cheerleader. The HOA provides and cares for these amenities for your enjoyment.  
  • HOAs Create Stability For The City– HOAs can lessen some of the financial burdens for municipal governments. The HOA’s work in an individual community frees up funds that the city can use elsewhere. This can raise property values across the city. 
  • HOAs Help Eliminate Residential Conflict– When you have an HOA patrolling your streets to ensure that everyone is following community guidelines, it eliminates the need for neighbors to confront each other directly when they disagree about the appearance or maintenance of their homes. You can also contact the HOA if you need to report something and remain anonymous, keeping the peace with those around you. HOAs also offer mediation services to help resolve a conflict between neighbors if necessary. 
  • HOAs Can Provide Increased Security– An HOA can often have its own security patrol in addition to the city’s police force. This is another way to alleviate pressure from the city while keeping you and your family even safer. 

Looking To Live In A Community With An HOA? 

Finding a home in a master-planned community with a strong HOA is easily found in the Houston area. Houston has some of the top master-planned communities in the country, which have excellent HOAs. 

If you’re not familiar with HOAs, note that Homeowner Association Fees are billed either monthly or annually, and there are a variety of costs and services that each one offers. When house hunting, make sure to compare HOAs rules, regulations, and payments.

After choosing a home and having your offer accepted, fees specific to the HOA are due at the closing table. Here are some examples of HOA-related fees that you may encounter as a buyer or seller:

HOA Fees – Who Pays What?

The Transfer Fee: a one-time fee the HOA charges for transferring internal paperwork from one owner to another.  Generally, $200-$500 / Customarily the Buyer

The Delivery Fee: a one-time fee the HOA charges for supplying your lender with HOA documents, if requested. Generally, $300-$1000 / Customarily the Buyer

The Resale Certificate: Gives specific information about the subject property and where it stands with the HOA. If the home is not in good standing, the title company will not let you close. Generally, $250-$700 / Paid by Buyer

Your Annual HOA Dues: Prorated at closing and then paid annually by the homeowner after that. Varies by Neighborhood / Homeowner’s Responsibility

Gate & Maintenance Fees: If you live in a townhouse or gated section, you will pay an additional amount included in your annual dues. Generally, $200-$700 / Homeowner’s Responsibility

Reserve Fund or Foundation Fee: A contribution collected at closing that goes into a reserve fund to pay for major unexpected repairs or assist in disaster relief. Generally, .25%-1% of the Sale Price / Customarily Paid by Seller 

Assessment or Capitalization Fee: Funds allocated for capital improvements such as common community areas, parks, pools, gyms, sidewalks, elevators, etc. Generally Equal to 1 Year of Annual Dues / Customarily Paid by Buyer

Living Houston Educates Their Buyers

These fees may sometimes feel like another added expense, but it’s the price you pay to live in a community that offers you amazing amenities, a beautiful environment that feels good to come home to, and personal and property security. Homeowners Association fees should be a happy expense, because you get so much more than you pay for. 

It’s also important that your Realtor® educates you on HOA fees, along with all other costs that come with buying a home. If you would like further clarification on the fees associated with an HOA or additional costs associated with home buying, contact Living Houston today for a consultation. 


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