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How to know if a community association is operating effectively


Homeowner’s associations or common interest developments house a good portion of homeowners in Florida. Associations that are managed well can bring additional value to a home. How a community is managed is one of the main aspects homeowners should consider when buying into a community association. How can a buyer determine if they should purchase a home that is part of a community association and whether the HOA is being run effectively? Some factors to consider include:

1. Maintenance: One thing you will notice right away when visiting a community is whether or not maintenance is being implemented effectively. Some bad signs to look out for include dead landscaping, peeling paint, and cracked stucco. One of the main responsibilities of an HOA is to ensure that the community is being properly cared for. Well-kept grounds means that HOA dollars are being used wisely.

2. Management: Some boards try to reduce costs by managing the HOA themselves. Unfortunately, this can end up increasing costs in the long run. Community association management companies have experience making sure communities are running smoothly in terms of maintenance, financials, communication, insurance, and more. HOAs should look for management companies that offer top quality services and credentials.

3. Insurance: Review the HOA’s summary of insurance and which risks are covered. Check for hurricane insurance, which could make the difference between HOA insolvency and rebuilding.

4. Board Meetings: HOA boards are required to meet at least quarterly, although the majority meet at least once a month. Board that meet very little may be operating informally, which is not a good sign.

5. Communication: Does the HOA keep members informed? This can be done through bulletin boards, websites, or newsletters. Make sure communication is clear, honest, and frequent.

6. Association Financial Stability: HOAs should provide detailed reserve funding disclosures, so make sure to actually read them. Reserve fund savings can actually be a good sign since it is a form of growing indebtedness. Healthy HOAs plan ahead and follow the guidelines of a reserve study.

While no HOA or home is perfect, these are some elements you can review to judge the quality of the HOA you will live under. It is important to know that the management you will live under is going to operate effectively and improve the quality of your community.

The community association management professionals at ASG specialize in HOA management and project management throughout Florida including Miami-Dade County, Broward County, and Palm Beach County.

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