The Dos and Don'ts of HOA Management for Maintaining HOA Home Values
Homes in HOAs are worth 5-6% more than comparable homes outside of these communities. With such figures, it's easy to see why about 60% of new construction homes in the United States are in HOA communities.
As a homebuyer, the prospect of greater home value appreciation is one of the most attractive things about HOA living. However, HOA home value doesn't automatically increase. A number of factors can influence these values, and HOA management is arguably the most impactful.
If you're part of an HOA management team and wondering what you can do to give the properties the best chance of gaining the most value, read on!
Great Choice of Location
The work of creating an HOA community that can preserve property value begins long before the first batch of owners move in. The people who're responsible for developing the community from scratch, before eventually handing it over to an association formed by the homeowners, focus on finding a great location.
In real estate, location is king. A secure neighborhood with good public infrastructure and social amenities will always have strong demand. The more people want to live there, the higher property values will rise.
HOA Bylaws
A developer won't stay around forever. They'll hand over the estate to the homeowner's association, who must then elect an HOA board to take over administrative and management functions. The first order of business is to create the community bylaws and CC&Rs.
This set of rules and regulations governs the community. They determine how an HOA is run and how the residents will conduct themselves while living in the community.
These rules also impact HOA property values. For example, think of an HOA's policy on rentals. Rental restrictions are good for maintaining home values since having too many renters can lower the community's quality of life. Renters have a reputation for disregarding community rules.
Service Providers
An HOA community has various amenities, such as clubhouses, driveways, swimming pools, and parks, that need to be cleaned and maintained. The security of the community is also a critical issue.
HOA management will typically contract third-party companies to provide these services. However, the quality of service provision can positively or negatively affect property values.
Imagine a situation where security personnel sleep on the job, and as a result, burglary incidents become commonplace in the community. If the issue is not addressed quickly, word will get out that the community is not safe, and it will lose its appeal to prospective buyers. That's how property values will start plummeting.
Professional Management Will Unlock HOA Home Value
HOA home value is a major concern for both owners and prospective buyers. HOA management has a big role to play in preserving and even shoring up these values.
Every community has its management strategy, but the best one is to outsource most functions to an association management company.
PMI New Orleans is a full-service association management company that's at the service of HOAs in New Orleans, Louisiana. We are part of the PMI franchise network, which has been in operation for over 20 years.
Contact us to learn more about our services.
