HOAs that save a dollar, only to cost homeowners thousands.
[00:00:00] The single biggest mistake that HOAs make is to try to save pennies while costing their members thousands of dollars. Most studies show that a home in an HOA is likely to have a greater value than one not in an HOA, but that assumes that the HOA is well managed. So management can have a huge impact on home values. A 2% difference in an $800,000 home,
[00:00:24] is a difference of $16,000 or a cumulative difference of 3.2 million in a 200-unit community. But too often an association gets hung up on making its choice of management company based on a few dollars. For example, a management fee of $1,800 a month versus a fee of $2,400 a month is only a difference of $3 a month
[00:00:45] for each home. But for many HOAs, that $600 a month overall cost will be the deciding factor. It’s a consideration, but the deciding factor should be based on who is going to manage the community the best, and how that will affect living experiences and property values in the community. $3 a month shouldn’t be the deciding factor.