Purpose of an HOA
Not everyone has heard-of or is familiar with what a HOA (Home Owners Association) is or does. Although HOAs are becoming increasingly common, there are parts of the country where HOAs are less common. Small towns and rural areas, for example.
Here I'll briefly explain the purpose of an HOA for those that may have never belonged to one and are unclear on its purpose.
Above all else, the main goal of an HOA is to preserve property values. Nobody wants the value of their largest investment to stagnate or tank for reasons that could be mitigated locally. Other important goals are making a neighborhood an enjoyable, attractive, and safe place to live -- all of which consequently contribute to the main goal.
Benefits of an HOA
An HOA accomplishes these goals in a number of ways. This list isn't necessarily all-encompassing.
Make-up of board and committees
All HOAs have a Board of Directors with the usual officers, including president, vice-president, secretary, treasurer, and one or more directors. Board members are elected by the membership (homeowners) to serve their community and run the association. In the Lakes of Sherbrooke and Bonita Isle, as with most HOAs, these are volunteer positions offering no compensation.
The board may also form committees to carry out specific tasks. Committees are staffed by volunteer homeowners and are absolutely critical to the successful running of an association. Such committees may include Compliance, Architectural, Landscaping, Painting, Welcome, Social, and more, depending on the needs of a particular community.
Some associations, such as Bonita Isle, are self-managed. This means the board does all the management work needed to run the association including keeping the books, records, collecting dues and paying vendors, managing people and tasks (committees), dealing with compliance issues, approving architectural changes, working with vendors (interview, letting contracts, etc.) It's like running a business -- quite a lot of work but for no pay.
To avoid all this, many associations hire management companies to do this work. In those associations, the board meets to make decisions but most or all the actual work is performed by a professional management company.
Governing Documents
In Florida at least, HOAs are regulated by state law. Beyond that, the HOA has Governing Documents that must be followed. There are multiple documents but the two main ones of interest are the following:
You can think of the CC&R as roughly the "constitution" and the R&R as "ordinances". The CC&R is very difficult to change, usually requiring a super-majority of the voting interests (homeowners). The R&R is a little easier to change but not by much.
Each of these documents enumerates the various policies, procedures, duties, rules, etc. for the association. Homeowners receive a copy of these and other documents at the time of purchase of the home. Buyers sign a declaration that states they have read, understand, and agree to abide by all of the associations' various governing documents.
An HOA actually has surprisingly little leeway in interpreting the docs and enforcing its provisions. It cannot simply invent new policies and rules nor strike existing ones on a whim. The documents specify how changes are to be made when changes becomes necessary.
Homeowner membership
Most HOAs, including The Lakes of Sherbrooke and all her various sub-associations, have a mandatory membership requirement. All homeowners are automatically members and required to make a monthly dues payment to the HOA. This money supports the association in all the ways mentioned above and more.
Our HOAs in The Lakes of Sherbrooke are not-for-profit. That is, every dollar goes to the welfare of the neighborhood. No elected or committee position offers compensation.
Commentary
HOAs sometimes get a bad rap as being undemocratic, onerous, or "bossy" but this really is the exception. Usually those complaints are made by those that run afoul of the rules that everyone, including the complainer, agreed-to. Every home I've owned in my lifetime has been in a HOA governed community and I've had no problems nor have most of my neighbors. Pretty much every board member I've ever met or served with understands the importance of their position and take the responsibility seriously. "Bad" board members usually don't last long, especially in an active, engaged community.
There are plenty of places to buy and live that have no HOA where homeowners can do pretty much anything they want (that's not illegal) -- and will sometimes do so without regard to how it affects their neighbors. For those that don't mind the randomness that a non-governed community may entail, those choices exist.
But for those that appreciate the stability and predictability of a governed community, there are choices there as well.
Here I'll briefly explain the purpose of an HOA for those that may have never belonged to one and are unclear on its purpose.
Above all else, the main goal of an HOA is to preserve property values. Nobody wants the value of their largest investment to stagnate or tank for reasons that could be mitigated locally. Other important goals are making a neighborhood an enjoyable, attractive, and safe place to live -- all of which consequently contribute to the main goal.
Benefits of an HOA
An HOA accomplishes these goals in a number of ways. This list isn't necessarily all-encompassing.
- Maintain a common scheme of development and maintenance.
- Provide for common amenities through shared ownership. e.g. Swimming pools, clubhouses, sports facilities, etc. that are often impractical or impossible to own individually.
- Reduced cost for certain household amenities by purchasing or contracting in bulk. e.g. Telecom services (internet, cable TV), landscaping, painting.
- Enforcement of acceptable use. e.g. Not allowing people to run retail businesses from their homes or renting out rooms.
- Requiring homeowners to maintain their home sites. e.g. Maintain fresh paint, keeping the home in good repair, elimination of trash, properly caring for the landscape, etc. We've all seen how decrepit homes can uglify and drag down the beauty of a street or an entire neighborhood. Who wants to buy in a neighborhood full of dumpy homes?
- Maintain the common appearance, however that may be defined by the governing documents. e.g. Would you want your next door neighbor painting their house pink with purple polka dots if that's not the prevailing scheme in the neighborhood?
- Enforce rules regarding vehicles.
- Many other things...
Make-up of board and committees
All HOAs have a Board of Directors with the usual officers, including president, vice-president, secretary, treasurer, and one or more directors. Board members are elected by the membership (homeowners) to serve their community and run the association. In the Lakes of Sherbrooke and Bonita Isle, as with most HOAs, these are volunteer positions offering no compensation.
The board may also form committees to carry out specific tasks. Committees are staffed by volunteer homeowners and are absolutely critical to the successful running of an association. Such committees may include Compliance, Architectural, Landscaping, Painting, Welcome, Social, and more, depending on the needs of a particular community.
Some associations, such as Bonita Isle, are self-managed. This means the board does all the management work needed to run the association including keeping the books, records, collecting dues and paying vendors, managing people and tasks (committees), dealing with compliance issues, approving architectural changes, working with vendors (interview, letting contracts, etc.) It's like running a business -- quite a lot of work but for no pay.
To avoid all this, many associations hire management companies to do this work. In those associations, the board meets to make decisions but most or all the actual work is performed by a professional management company.
Governing Documents
In Florida at least, HOAs are regulated by state law. Beyond that, the HOA has Governing Documents that must be followed. There are multiple documents but the two main ones of interest are the following:
- CC&R (Covenant, Conditions, and Restrictions)
- R&R (Rules and Regulations)
You can think of the CC&R as roughly the "constitution" and the R&R as "ordinances". The CC&R is very difficult to change, usually requiring a super-majority of the voting interests (homeowners). The R&R is a little easier to change but not by much.
Each of these documents enumerates the various policies, procedures, duties, rules, etc. for the association. Homeowners receive a copy of these and other documents at the time of purchase of the home. Buyers sign a declaration that states they have read, understand, and agree to abide by all of the associations' various governing documents.
An HOA actually has surprisingly little leeway in interpreting the docs and enforcing its provisions. It cannot simply invent new policies and rules nor strike existing ones on a whim. The documents specify how changes are to be made when changes becomes necessary.
Homeowner membership
Most HOAs, including The Lakes of Sherbrooke and all her various sub-associations, have a mandatory membership requirement. All homeowners are automatically members and required to make a monthly dues payment to the HOA. This money supports the association in all the ways mentioned above and more.
Our HOAs in The Lakes of Sherbrooke are not-for-profit. That is, every dollar goes to the welfare of the neighborhood. No elected or committee position offers compensation.
Commentary
HOAs sometimes get a bad rap as being undemocratic, onerous, or "bossy" but this really is the exception. Usually those complaints are made by those that run afoul of the rules that everyone, including the complainer, agreed-to. Every home I've owned in my lifetime has been in a HOA governed community and I've had no problems nor have most of my neighbors. Pretty much every board member I've ever met or served with understands the importance of their position and take the responsibility seriously. "Bad" board members usually don't last long, especially in an active, engaged community.
There are plenty of places to buy and live that have no HOA where homeowners can do pretty much anything they want (that's not illegal) -- and will sometimes do so without regard to how it affects their neighbors. For those that don't mind the randomness that a non-governed community may entail, those choices exist.
But for those that appreciate the stability and predictability of a governed community, there are choices there as well.