Do your research before buying home
If you plan to buy a home or condominium, keep in mind that the property may be governed by a homeowners association, or HOA.
Many buyers appreciate the benefits provided by HOAs, but the mandatory dues and covenants, conditions and restrictions (CCRs) occasionally rub some people the wrong way. Before you make an offer on a property governed by an HOA, here are some factors to consider.
Homeowners associations often provide access to amenities that individual residents couldn’t otherwise afford – pools, gyms, tennis courts, walking trails – and their rules can protect property values. Some associations also take on services traditionally provided by government, such as trash pickup, landscaping, street lighting and street and sidewalk maintenance.
Your perfect condo may have a great pool or your dream home might be sitting on the first tee, but remember that those things are only part of the HOA’s scope. When you purchase a property governed by an HOA, you enter into a legal contract with the association. You agree to abide by the association’s regulations and pay its dues. In exchange, you get a community guided by an HOA and the access to its facilities and perks. Make sure that any uses or freedoms you expect to come along with your property are allowed in the CCRs. Want to store your boat trailer in your driveway? The association’s CCRs may not allow that. Want to paint the house? Some HOAs have restrictions on permissible colors.
You may have heard horror stories of home repossessions and other legal squabbles involving property owners and HOAs. A common theme among many of these cases is homeowners not understanding the regulations or ignoring them. Review the CCRs carefully before you purchase the property; you’ll be much less likely to run afoul of your HOA.
HOAs run on dues, your annual fee for living in the community. Ask how much the dues are and if they’ve increased during the past few years.
Find out what the dues cover and what they don’t. For example, your condo association may perform all exterior maintenance. That means when the roof leaks, your dues pay for its repair, even if you live on the ground floor of a three-story building. If you live on that third floor, however, you don’t have to pay to repair the entire roof yourself. If the association manages a pool, you’re paying for it, even if you can’t swim and never use the amenity.
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Perform due diligence before signing a contract to purchase a property governed by a homeowners association. You’ll be able to make an informed decision about the HOA’s pros and cons, as well as your responsibilities, without jeopardizing the transaction or subjecting yourself to regulations that aren’t consistent with your lifestyle. Cindy Hamann of Heritage Texas Properties is 2017 chair of the Houston Association of Realtors/HAR.com.