RealManage Insight

The Top 10 Things You Should Know About Community Associations

by Camille Moore on Nov 29, 2022 1:30:00 PM

Community associations are becoming increasingly popular across the United States. They offer several advantages for homeowners, including maintenance and landscaping services, security, and social opportunities. 

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If you are considering purchasing a home in a community association, it is important to understand the basics about these organizations. This blog post will discuss the top ten things you should know about community associations!

10. Community Associations Trace Their Roots Back Hundreds of Years

It may seem like HOAs/community associations are a relatively new phenomenon, but that isn’t the case at all. Beginning hundreds of years ago, business associations helped their members deal with issues such as paving streets to cobblestones, establishing agreed-upon horse parking, and more.

Of course, these issues continue to occupy associations today, including street maintenance, parking, and pets. Community associations exploded in the 1960s as the suburbs were built. 

9. You Can Ask to See the Covenants, Conditions, and Restrictions (CC&Rs) Before Purchasing a Home in an Association

In order for a community association to function properly, its members must adhere to a set of guidelines known as covenants, conditions, and restrictions (CC&Rs). CC&Rs are legally binding documents detailing the rules and regulations HOAs must follow. They also outline the rights and responsibilities of both the association and its members. 

Failure to comply with CC&Rs can result in fines or even expulsion from the community. Before purchasing a home in an HOA- governed community, it is important to review the (CC&Rs) to ensure that the communities guidelines will be a good fit for you. 

8. Homeowners Must Pay Association Assessments

Homeowners in mandatory community associations typically pay monthly, quarterly, semi-annual or annual assessments. The money from these assessments is used to cover the costs of maintaining common areas, such as pools, playgrounds, and landscaping, along with other operating expenses, such as insurance.

The assessments also help to pay for services like trash removal and security. In some cases, the money from HOA fees is also used to make improvements to the community, like repaving roads or adding new features.

7. Community Associations Can Be Businesses and Not-for-Profits

It is important to understand how community associations are structured. Associations are typically organized as either HOAs or condominiums. In an HOA, members own their home and their own lots. The association, as a corporation, owns any common area. In a condo, the members own their own unit and jointly own a percentage of the property and common area. 

Associations are typically required to be registered with the state. Most associations are organized as not-for-profit corporations with the purpose of collecting assessments for community benefit. 

Not-for-profit corporations are different from non-profits. Non-profit is an IRS designation for charities that exempts charities from paying federal income tax. It is rare for an association to be a non-profit. 

6. Living in a Community Association Helps Maintain Property Value 

One of the most important roles of a community association is to help maintain property values. By establishing rules and guidelines for how properties can be used and maintained, the association can help to ensure that all homes in the community meet certain standards. This, in turn, makes it more likely that homes will retain their value over time. 

Furthermore, associations often have access to professional landscaping and maintenance services that can keep properties looking their best. In addition, many associations offer amenities like swimming pools and fitness centers that can make a community more attractive to potential buyers. 

5. Community Association Board Members are Volunteers 

Community associations are run by a board of directors that typically consists of a president, vice president, secretary, and treasurer. Board members are not paid for their time or services. They are homeowner volunteers who donate their time to help manage and maintain the association. 

They are usually elected by the homeowners and serve for a set term. Some associations have board member terms that last for one year, while others may allow people to serve longer terms.

4. Community Associations Aren’t Just for Condos 

While most people associate community associations with condominiums, they can actually be found in various types of neighborhoods.

For example, many townhome and single-family communities have community associations that help manage common areas and provide residents with various amenities. In addition, community associations can also help to foster a sense of community among neighbors and provide a platform for social events and activities. 

3. Rules and Regulations Vary By State

Each state has its own laws governing the formation and operation of community associations, so the rules and regulations that apply to a community can vary quite significantly from one state to another and from one association to another. 

For example, some states do not allow restrictions on things like solar panels, propane tanks or political signs, while others do. 

As a result, it is important for anyone considering buying a property in an HOA-governed community to familiarize themselves with the state's applicable laws and the community's governing documents. Otherwise, they may find themselves subject to rules and regulations that they were unaware of when they purchased their property.

2. The Association’s Executive Board Can Help Handle Disputes

In any community, there are bound to be disagreements from time to time. Whether it's a disagreement about noise levels, parking, or the upkeep of the common areas, these disputes can quickly escalate and cause tension among neighbors. 

The association board can act as a mediator between neighbors and help to resolve disagreements in a fair and efficient manner. For continued problems, the board can also set and enforce rules and regulations that help to keep the community running smoothly. 

1. The Majority of People Who Live in Community Associations Have a Positive Experience

There are some people who may be hesitant to purchase a home that is overseen by a community association because they fear that the rules and regulations will negatively affect their quality of life. However, the reality is that the majority of people enjoy living in a community association. 

In fact, 90% of people living in community associations reported having a good relationship with their board of directors, and 70% reported that living in their community was a good experience. 

Final Thoughts

Community associations can provide a wealth of benefits for homeowners, and with the right knowledge, you can make the most of your community association. Whether you’re thinking of moving into an association or are already living in one, we hope the tips we’ve shared allow you to feel more empowered.

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