What are HOA Dues used for?
Although HOA assessments can be regarded by some as unnecessarily expensive, or even just unnecessary, in fact they play crucial part in protecting your lifestyle and making sure that you live in a financially viable, clean, safe and visually appealing community, which goes a long way to protecting the value of your property.
Whenever possible, HOAs try to put a share of the assessments into special reserve funds covering special projects, i.e., repairs or renovations that don’t require regular attention, e.g., resurfacing the roads in your community, replacing gates, replacing swimming pool systems, and so forth. Should the reserve fund not contain sufficient monies for these expenses, the HOA will introduce a special assessment, which you are obliged to pay.
An association has to take out a master insurance policy to protect all shared property, exteriors, and buildings from damage; additional insurance may be required, for example 3rd party insurance, depending on the types of properties in your community, local regulations, etc. Don’t forget that this insurance doesn’t cover your own property, you still need a policy for your home.
HOAs have to pay bills for heating, water, light, electricity, air conditioning, etc. used in any shared areas of your community.
If a community has contracted employees, e.g. social events coordinators, janitorial staff, maintenance staff, etc., some of the assessment will be used for paying salaries/benefits to them.
This includes maintaining and repairing any shared areas, amenities, systems, and equipment. This can encompass landscaping and lawn care, water facilities, sewage systems, plumbing, air-conditioning/heating systems in communal buildings, street lighting, removing trash, maintaining shared amenities like tennis courts, basketball courts, playgrounds, pools, clubhouses, workout equipment, etc., pest control, painting, cleaning, elevator systems, security systems, and maintaining shared exteriors.
To guarantee that community finances and management remain stable and operating, an HOA may frequently decide to employ a professional community association management company whose fees will be paid for from the HOA assessment. Such companies are responsible for effective implementation of the Board’s policies, providing a complete management solution that can offer excellent value and improve the general environs and lifestyle of the community.
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