If you currently have or are looking for a home in Denver, you’ll undoubtedly be looking at more than a few homes which fall under a homeowner’s association (HOA). A homeowner’s association can add a lot of value, a lot of headache, and/or a lot of cost to your home. Here we ask and answer important questions about HOAs.
What Does a Homeowner’s Association Do?
A homeowner’s association is intended to preserve property values, maintain the common spaces and, in limited cases, resolve neighborly disputes. To that end, the homeowner’s association will send out notices to those who are not in compliance with their rules. The homeowner’s association will also collect dues and use these dues for improvements, such as common area landscaping and road repair.
What Are the Benefits of a Homeowner’s Association?
No one wants to purchase a beautiful home only to have their property values tanked by a less than desirable neighbor. A homeowner’s association reduces this risk by ensuring that everyone is held to the same standards of maintenance and cleanliness.
Homeowner’s associations also ensure that common areas are kept clean and well-maintained, which is something that is otherwise often left up to each individual homeowner (and can be quite difficult to organize). Homeowner’s associations may also maintain community resources, such as BBQ areas, pools and playgrounds – all of which are quite valuable to a suburban area.
What Are the Drawbacks of a Homeowner’s Association?
Though a homeowner’s association may sound fantastic on paper, there are some issues that can arise. In addition to the sometimes high monthly costs, homeowners who purchase a home within association control will need to follow certain by-laws, which may include:
- The colors that homes are allowed to be painted.
- The decorations that are allowed within yards.
- The structure and colors of fencing.
Those who do not follow these by-laws will receive notices and, if the matter is not dealt with, fines. The major goal of an HOA is to ensure that the properties within the association remain consistent and homogenous. Clean, well-maintained properties bolster property values. But some homeowners prefer to remain in complete control of their properties.
Moreover, some homeowners may have problems with the HOA itself. For those who fear bad neighbors, a bad homeowner’s association can be an even worse proposition. Usually, a homeowner’s association is run by a board of homeowners who are elected to that position. Thus, not all homeowner’s associations will be reasonable or sensible.
How Much Does a Homeowner’s Association Cost?
In Denver, a homeowner’s association fee will usually range between $200 and $400. These fees will pay for the administration of the HOA in addition to maintaining and improving the community. Prospective home buyers need to carefully consider the cost of an HOA in their monthly housing payments. Unlike other home maintenance costs, HOA dues are not tax-deductible and may be a significant expense.
Whether a homeowner should purchase a property with an HOA depends entirely on the homeowner’s priorities. In general, a homeowner’s association will be able to maintain and even improve property values. However, a homeowner will lose some amount of control over their property and their lifestyle.