Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
We got a new board in the building where I live. I currently pay 208.00 HOA for the building. The board says that come January, it will go up to 400.00 because the precious board was shady, and now we don’t have enough funds on reserve. The current board put everything on paper to show us.
I just never heard HOA being raised so much at one time. The 400.00 is only for our building. I pay two other bills for ground maintenance and recreation totaling 240.00. So now come January my total HOA will be 640.00 a month. And that’s if the other 2 don’t go up. I have never heard HOA being so high. But I know everything is high right now. So, then again, how would I know what other places charge. But it just seems like a ridiculous amount.
What people pay in other HOAs obviously depends greatly on a number of factors. In urban high-rises it's not uncommon for association fees to be over a grand a month, especially for maintenance-intensive vintage buildings. But that will often include all utilities including cable and internet and rec facilities like gym, pool, clubhouse, etc.
As for your specific situation... if there's a substantial reserve deficit, a spike in monthly dues is pretty much the only practical remedy other than an even more painful one-time special assessment. Maybe the previous board could be sued for breach of fiduciary duty but that doesn't repair the financial hole the association faces; it just brings some measure of justice.
What people pay in other HOAs obviously depends greatly on a number of factors. In urban high-rises it's not uncommon for association fees to be over a grand a month, especially for maintenance-intensive vintage buildings. But that will often include all utilities including cable and internet and rec facilities like gym, pool, clubhouse, etc.
As for your specific situation... if there's a substantial reserve deficit, a spike in monthly dues is pretty much the only practical remedy other than an even more painful one-time special assessment. Maybe the previous board could be sued for breach of fiduciary duty but that doesn't repair the financial hole the association faces; it just brings some measure of justice.
Well said. Each association situation is unique.
And...
If the condo owners want to maintain, or perhaps regain, HUD-Warrantable status, so buyers can obtain conventional financing, making the units more valuable on the market, rebuilding the reserves is a very important effort.
And, smart buyers will review condo association financials before proceeding. Adequate reserves are a huge component of that review.
I'll carry on a bit more.... for comparison, we own two properties in HOAs. For one, the monthly HOA does are $320/mo.; or the other, it's $65/mo. Why the difference?
Well, the first one includes mowing, landscaping, snow removal right up to our doorstep, exterior maintenance including new roofing and new siding when needed, and two community pools staffed by paid lifeguards from Mayday to Labor Day. Oh yeah, and our driveways get repaved every six years whether they need to be or not. And driveway cracks get sealed during the intervening six years. About the only thing they don't do is wash our dishes and vacuum our carpet. Since we have no desire to budget for or do any of those other things ourselves, we consider it money well-spent.
The other includes a maintained trail system through several hundred wooded acres, a boat launch on a lake abutting to the community property, and a pier to keep your boat at 5 months out of the year. All the other maintenance items mentioned in the first example are up to us.
Quote:
Originally Posted by MikeJaquish
And, smart buyers will review condo association financials before proceeding. Adequate reserves are a huge component of that review.
I'm curious to tap your real estate agent knowledge/expertise on this issue... is this something the lenders would also want to evaluate before lending? I guess the answer is mostly found in "crap reserves = no conventional loan" point you raise. But do lenders rely on a HUD evaluation/determination or is this something lenders evaluate independently?
I'll carry on a bit more.... for comparison, we own two properties in HOAs. For one, the monthly HOA does are $320/mo.; or the other, it's $65/mo. Why the difference?
Well, the first one includes mowing, landscaping, snow removal right up to our doorstep, exterior maintenance including new roofing and new siding when needed, and two community pools staffed by paid lifeguards from Mayday to Labor Day. Oh yeah, and our driveways get repaved every six years whether they need to be or not. And driveway cracks get sealed during the intervening six years. About the only thing they don't do is wash our dishes and vacuum our carpet. Since we have no desire to budget for or do any of those other things ourselves, we consider it money well-spent.
The other includes a maintained trail system through several hundred wooded acres, a boat launch on a lake abutting to the community property, and a pier to keep your boat at 5 months out of the year. All the other maintenance items mentioned in the first example are up to us.
I'm curious to tap your real estate agent knowledge/expertise on this issue... is this something the lenders would also want to evaluate before lending? I guess the answer is mostly found in "crap reserves = no conventional loan" point you raise. But do lenders rely on a HUD evaluation/determination or is this something lenders evaluate independently?
I haven't done a condo in years, and would defer to a lender to answer.
Often when the reserves are inadequate, the complex is high in rentals, "N/O/O," Non Owner Occupied, and that is a real quick flag.
Lenders will go by the HUD website lists of warrantable/non-warrantable. Might be a good question to ask on the Mortgages forum, to see if some of the mortgage contributors would weigh in.
If OP is in Florida this was expected. We just had new legislation passed in July that is going to jack up condo fees for most associations. New reserve requirements, new mandatory inspections and mandated maintenance. This is not even including the rapidly rising master insurance policy premiums. If you live in a Florida condo be prepared for higher and in some cases substantially higher fees.
I'm curious to tap your real estate agent knowledge/expertise on this issue... is this something the lenders would also want to evaluate before lending? I guess the answer is mostly found in "crap reserves = no conventional loan" point you raise. But do lenders rely on a HUD evaluation/determination or is this something lenders evaluate independently?
Here's the Fannie Mae condo questionnaire for a full review conventional loan for a condo purchase in Florida. Some associations have understandably started refusing to complete the questionnaire which changed earlier this year because of possibility of liability. In those cases, no one can buy in the building using a conventional loan.
Here's the Fannie Mae condo questionnaire for a full review conventional loan for a condo purchase in Florida. Some associations have understandably started refusing to complete the questionnaire which changed earlier this year because of possibility of liability. In those cases, no one can buy in the building using a conventional loan.
Interesting risk/cost assessment process -- incur present costs by making the units tangibly less saleable now to avoid theoretical but unrealized liability costs. Hard to see how that pays off in the long run unless it's a hot market with buyers lined up with cash in hand.
Interesting risk/cost assessment process -- incur present costs by making the units tangibly less saleable now to avoid theoretical but unrealized liability costs. Hard to see how that pays off in the long run unless it's a hot market with buyers lined up with cash in hand.
That’s a good point I hadn’t thought of. Thanks.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.