Let’s say you have your heart set on buying a home in Dallas Texas, Frisco Texas, Coppell Texas, Southlake Texas or Flower Mound Texas in a community with a swimming pool, a clubhouse, and maybe even a playground or trails. Having access to these amenities often means living in a community with a homeowners association, or HOA. Many homes in Texas are located in subdivisions that are governed or managed by a homeowners' association, or property owners' association, as they are referred to in the state statutes.
Generally, an HOA is responsible for keeping the neighborhood looking beautiful — and as a result, keeping property values high. But since no two neighborhoods are the same, no two HOAs will be the same, either.
What You Should Know About the Homeowners Association Doing your research on homes and communities means finding the answers to dozens of questions. As a savvy home buyer, you’ve probably already considered some of the most important topics early on in your home search, such as the local property taxes and whether the neighborhood is appreciating in value.
But if you’re considering a neighborhood with an HOA, there are a few additional things that you should know about the community and the association before you buy a home. Here are the essential questions you should ask.
1. What Does the Homeowners Association Do? Each community varies, but in general, a homeowners association assists residents with property maintenance (by providing services like lawn care, trash removal, or Internet), regularly beautifies the neighborhood common areas, and upkeeps any shared amenities. In return for these services, residents pay an association fee, which we’ll talk about later.
Since the HOA is also concerned with keeping property values high, the homeowners association may also dictate what residents can and can’t do with their properties. These rules keep residents from worrying about a neighbor painting their house a funky color or letting their lawn go wild.
2. Are You Required to Join the HOA? Before you decide to buy a home in an HOA neighborhood, first check to see whether the community has a voluntary or mandatory HOA. A voluntary HOA doesn’t require that you join the association or pay dues, but a mandatory HOA does. Most of the homes in DFW metro area mandate joining the HOA if an HOA exists.
3. How Much Are the HOA Fees? As we mentioned before, HOA fees cover the services that the association provides. HOA fee costs (and the frequency with which they’re paid) can vary from community to community, so ask your real estate agent about how much the fees are before you buy a home in the neighborhood. They can vary from $40 per month to $400 per month depending on the community, type of home ( single family vs. condo) and amenities offered by the HOA.
4. What Are the HOA’s Expectations for Residents? Bylaws for a community associationTypically, a homeowners association will have a list of rules and regulations that residents are expected to follow when they live in the community. (These are known as Covenants, Conditions, and Restrictions, or CC&Rs.)
These regulations can dictate everything from what colors you can use to paint your home to how many vehicles you can park in the driveway. Again, each homeowners association varies, so it’s best to read the Bylaws of communities you’re considering to learn what’s expected of residents. E.g. if you are thinking of buying an investment property, the HOA may not allow homes in the community to be leased!
5. When (And How Often) Does the HOA Meet? If you’re interested in joining your neighborhood’s HOA to get involved in your community, you might also want to consider when the association meets. The HOA may meet annually, bimonthly, or monthly, depending on the association’s size, so check to see if the regular meetings will fit within your schedule. Remember that all the HOAs are run by volunteer board members!
6. What is covered by HOA dues? Find out what HOA provides as part of the dues charged by HOA. Is your home yard mowed and is home structure insurance covered by HOA?
7. What is the current financial situation of HOA? You would want to know the current financial situation of HOA - reserves and current income/expenses to make sure that the HOA is going to be solvent in future in case of any major repairs needed to the community. E.g. in case of an earthquake, all the boundary walls may need be rebuilt at the cost of thousands of dollars.
8. Does the HOA Host Any Activities? Finally, when considering a neighborhood with an HOA, you should learn whether the HOA provides other ways for you to get involved and meet your neighbors. Ask your real estate agent about whether the neighborhood association hosts annual block parties, pool parties, holiday celebrations, Yard of the Month competitions, or any other neighborhood activities.
New Home Buying Tip: After Thanksgiving each year the new home builders in the DFW area start marking down inventory for end of year financial reporting. THEY NEED TO SELL! Great time to start looking at builder homes. Most have started slashing prices or offering incentives. Contact us today to get a great deal on new homes!
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