What to Ask Your Realtor Before You Purchase a Home in an HOA
We’re going to talk today a little bit about what you should ask your realtor before you purchase in an HOA!
What are the HOA dues?
First off, you’re definitely going to want to ask how much each month, quarter, or year you’ll need to pay in the form of dues, and the exact date that these payments are expected.
Also, find out what these dues include. Do they cover things like trash, utilities, and lawn and snow care, for example, or are these services you’ll be financially liable for yourself?
Are there any special assessments that might be coming up?
This would also be listed on the resale disclosure statement.
Is there any current or pending litigation going on in the community?
This is something you’d want to know, for obvious reasons!
Does the association have a reserve study?
If so, when was it last updated? How recently the study has been appraised is an indication of how proactive the board has been in planning for upcoming or large projects that will come out of that account. Whether it’s a year, three years, or a decade from now, it’s good to know what the board foresees in its future spending.
How many homes are owned or occupied?
This is important because it gives you an idea of how many people rent their units. If this percentage is high, this could negatively impact the value of the homes, as renters typically don't take as good of care of the property as an actual homeowner would.
What do the association’s governing documents say about rentals?
Can you only rent your unit after you’ve lived there for a certain amount of time? Some associations have pretty strict rental rules, so take a look at those and learn what you can and can’t do when it comes to renting.
Are pets allowed?
If so, is there a limit to the size, weight, or number of pets you’re allowed to have? Some governing documents might say you can only have one dog and one cat, not two dogs, for example. If you have animal companions, ask these questions so you don’t get in trouble down the road.
What are the maintenance responsibilities for homeowners?
This one’s really important. A lot of people assume that an HOA is responsible for more than it actually is, and are surprised to find that certain costs, like repairs, can be billed back to the homeowner.
What are the architectural guidelines?
Familiarize yourself with these so that if your neighbor violates them, you’ll know about it.
Can I review the board meeting minutes?
Can you review the meeting minutes to get an idea of what decisions the board has been making recently and to better understand their future plans? This will let you know how active your board is and what they’re thinking about long-term. Understanding this will help to protect your property value. If your realtor doesn't know how to find this information, have them contact the management company or the board of directors.
To sum up the in-HOA buying process: Rely on your realtor to guide you through it. This is a large investment, so ask them questions to avoid buying a property in a community in which you have no idea what’s going on. Relying on your realtor for help also prevents the frustration and confusion that comes with buying in an HOA that has tons of hidden issues. Asking the right questions can make a world of difference and save you thousands of dollars down the road.