I got a bill in the mail the other day from our Home Owners Association for a 6-month payment. Now, I knew this expense was coming and it is in the monthly budget (see my post – May 2008 – Family Budget Review) so the bill was not a surprise. But what is frustrating is that many of the things that we are paying for have not been built or introduced to the neighborhood. For example, the HOA budget calls for a $2,000+ expense for 2008 in pool maintenance. I have been tired lately and have found myself not paying attention to certain things, but I don’t remember seeing a pool yet in the neighborhood! Originally when we signed our contract last summer to purchase the home, a community pool was going to be built and ready for use this summer. However, with the slowdown in the housing industry, the development has slowed down and there are not enough homes yet to support a pool. That is fine, I guess. Just don’t tell that to my 4-year old son on a 95-degree day. Anyway, we can live without the pool this summer – just not sure why we are paying for it?
The neighborhood street lights are another point of frustration. There is a line item in the budget for the installation and ongoing maintenance of street lights (see my related post about Keeping the Lights On!) for 2008. Once again, I have not noticed any street lights yet in the neighborhood. Maybe they are on the other road?
Then there is the landscaping and mowing expense. Hmmm – once again, I have not seen any landscaping in the common areas yet. Oh wait – I did see some wood chips up front by the neighborhood sign. That must have been what we paid for. Finally – something I can see my hard earned money going for. Ok – now we are in business! Oh wait, it is hard to see the wood chips from every angle because of the 18” grass that is surrounding the sign. Part of the budget also calls for expenses to cut the common area grass. I have been told by one neighbor that the town we live in actually came out and had to cut the grass 3 times to date as the Association won’t do it.
Apparently the developer of the neighborhood is in charge and responsible for the association until 75% of the homes are built in the neighborhood (which could be years). Once the 75% mark has been met, then the homeowners take over control and can manage the property themselves. We have left many unanswered and unreturned calls to the developer and his associates. Our neighbors have done the same thing with no results. We have threatened to withhold our payment until we have some answers as have our neighbors. The only thing we have been told is that if we don’t pay, the developer can put a lean on the property and it could go to foreclosure. We are in the process of trying to organize some sort of legal action against the developer to attempt to get some answers or results. Unfortunately, I think we are going to have to pay our bill that is due at the beginning of July to avoid any potential issues.
Just a note, the builder of the subdivision is different than the developer. The builder buys lots from the developer and does the construction of the homes while the developer is in charge of the entire subdivision.
What types of experiences (good and bad) have you add with HOA’s?
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I never had any experience with HOA, only knew that they were a necessary fee for such a community. I look forward to hearing more about your experience with this and whether it is worth it financially.
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HOA’s are always a source of frustration. I think most people are unhappy with them unless they are a member of the board. And most of us aren’t motivated to use our precious time to become a board member unless we become really upset with the way things are being run. Most of the complaints I hear about are for dues being too high or for gestapo like tactics in enforcing minor rules that have no real effect on the neighborhood (You put your trash out one day to early!). In my current subdivision, they actually charge too little. At $100 per year and with only about 600 homes very little gets accomplished.
The other major problem with home owners associations and subdivisions in general is that developers are in business to make a profit. Consequently, when they develope a neighborhood they put in the cheapest parts they can get for the fountain at the entrance. The clubhouse has a nice exterior but is made of unpressure treated wood, etc. This means that everything looks great until all the homes are sold. After that, the homeowners suddenly find out that many of their ammenities need major maintenance. And that nice low rate that homeowners were promised when they moved in suddenly needs to double.
Unfortunately, there is no solution for this. If one wants to move into a new subdivision you just need to be aware of the game that is being played and expect your HOA dues to go.
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I’d have to agree with Mike on this one. The idea of an HOA makes sense, but the implementation tends to be lacking in my experience. My wife and I actually bought a home in a neighborhood with no HOA and very minimal common areas for just that reason.
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Mark – We actually had a couple in the neighborhood organize a meeting for the homeowners this Wednesday so we can lay out our issues and determine our next steps. I will write a follow up post on our activity.
Mikewoodbooks – Thanks for the visit to the site. Yeah, this is our 2nd home we have owned with an HOA. I think in certain cases they are good (i.e. making people cut their grass when it is 18″ long, etc.). However, both experiences we have had so far have been very frustrating.
Ralph – We wanted to buy into a community that had a pool for our son’s to enjoy. Those don’t come without the HOA as well, so we choose the pool over not having an HOA. So far, it hasn’t been a good choice.
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I don’t blame you a bit for the choice. It’s just sad that they have such a poor reputation when they’re in place to serve a need of community members.
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