If you’re buying real estate in Davie, Florida, there may be a Home Owners Association (HOA) in the area, regardless of whether you’re buying a single family home or a condominium. A Florida HOA will have an impact on your enjoyment of your home and your pocketbook. Therefore, it’s important that you investigate the HOA before making any final decisions about your purchase. Here’s what you need to know.
What is an HOA?
If you live in a community that has amenities used by everyone in the neighborhood, such as swimming pools and security gates, you probably will have an HOA that is responsible for maintaining the community’s assets. If you live in a condominium or townhome communities, there is usually always an HOA.
A board of directors consisting of volunteer property owners runs the HOA. Other property owners in the community elect the board members. The HOA itself is regulated by the Florida Homeowners’ Association Act. The board of directors must ensure that the operation of the HOA complies with that legislation.
Other responsibilities of the board include protecting the value of the homes and community common areas, enforcing the covenants and restrictions that are in effect, and collecting HOA fees.
The covenants and restrictions are written rules that all the homeowners have agreed to and will follow. The fees are used to do regular maintenance of the common property, and a portion is put aside as a cash reserve for more major repairs.
What You Need to Know About a Florida HOA Before You Buy
Before purchasing a home in a community that has an HOA, you want to be sure that you trust the operation of the HOA and can abide by the covenants and restrictions that are in place.
1. Review the financial health of the HOA
Recurring Fees: The most common HOA fee is the regularly assessed fees. Typically, these fees are due on a monthly or quarterly basis. Find out what the fee is, how it is determined, and how often the fee has been raised in the past. In addition, make sure you understand what the fee covers and what it doesn’t!
Special Assessments: When the HOA needs to spend money that isn’t in the budget, the Board may call for a Special Assessment. For example, let’s say that your community pool has a major problem that is going to require a major repair. If the money isn’t in the budget, a special assessment might be the only way to make the repair in a timely fashion. Find out how often special assessments have been used in the past, what the amount was per owner, and whether there are any special assessments currently under consideration.
The Reserve Fund: Some repairs or unexpected expenses can typically be paid using the Reserve Fund. Find out how the HOA manages that fund.
If recurring fees are raised often, be sure and ask why. If the board isn’t managing costs well, they’ll need to raise fees more often. If special assessments are used frequently, it may indicate that the HOA isn’t managing its reserves well, or is not planning ahead to be prepared when more major repairs are going to be needed.
2. Carefully review the covenants and restrictions
You need to know what the rules are and whether you can abide by them. Does the HOA prohibit the fence you want to build for your dog? Can you paint your home any color you choose? You may be surprised at how unreasonable some of the rules may seem. But, you can’t underestimate the unreasonable things that some homeowners might do if there weren’t a rule against it.
Find out how the HOA enforces the rules. For example, ask if they have the right to fine you or put a lien on your home. If the HOA doesn’t currently allow fences, for example, is there a process for asking for a variance? Can a majority vote by the homeowners change the rules?
Keep in mind that most HOA rules are there to protect the value of all of the homeowners’ property. You may agree that you don’t want to live beside a hot pink home. But, if it looks like you can’t abide by the rules, you need to search for homes in another community.
3. Determine if the home you’re interested in is in compliance
There’s nothing worse than moving into a new home only to discover that it doesn’t follow the covenants and restrictions of the HOA. In that case, you’re the one who would be responsible for making the required changes.
Don’t assume that the Florida HOA in the area where you want to buy will be the same as the one in the area where you live currently. Each HOA has its own personality. If its personality and yours don’t get along, you won’t be happy with your new home. Always take the time to research an HOA carefully before you finalize a home purchase.
Speaking of purchasing a home. . . If you’re looking for a Broward County REALTOR®, we hope you’ll give us a call at 954-242-8030 or send us an email. Our team is knowledgeable, experienced and passionate about working with buyers and sellers in the area. We’ll make sure you have the information you need to make informed decisions. Just take a look at what our clients say about us!