Though many Southern Californians live in neighborhoods that are governed by a community association, we find that lots of residents are unclear about the rights and responsibilities they have as members of the association. As a result, homeowners and condo owners are missing out on the complete scope of available benefits. In this article, we aim to answer everything you wanted to know about the basics of community association management…but were afraid to ask.
What, exactly, is a community association?
A community association (also called a homeowner association, homeowners association, or HOA) is a non-profit mutual benefit corporation. It is a legal entity charged with managing and maintaining the property and has an important fiduciary responsibility to oversee financial management of association funds, collected in the form of member dues
How do I become a member of an HOA?
When you buy a property that is part of the association, you automatically become a member and receive the rights of membership, as defined in your association’s governing documents. You are generally not able to “opt out” of joining the association; it is a requirement that accompanies your property purchase.
What does HOA membership entail?
When you buy into the association, you legally undertake the responsibility and duties of membership. These rights generally include things like the right to use common areas, the right to run for a seat on the board of directors, the right to enjoy your property, etc. It also means that you will be obligated to follow all association rules and support the association through regular payment of dues.
Where can I find more information about my community association?
Most community associations maintain current governing documents, including Articles of Incorporation, Rules & Regulations, Bylaws and Declarations of Covenants, Conditions and Restrictions (called “CC&Rs”). The Articles of Incorporation outline basic information about the organization, including the association’s name, location, and purpose. Bylaws cover how the organization is run and usually detail the association’s rights and responsibilities as well. CC&Rs make up a more comprehensive document that spells out in great detail all the specifics about homeowner and association rights and responsibilities. Finally, the Rules & Regulations are the day-to-day rules by which homeowners must abide. You can usually find your association’s governing documents on your community’s website or you may request a copy from a board member or your community association management company.
What are the benefits of community association management?
Living in an area that is overseen by an HOA is your choice. You are not required to purchase a home in an area governed by an HOA. However, homes with community associations enjoy significant advantages including:
- Higher property values. Because rules and regulations are in place, properties, and common areas are usually better maintained which helps keep property values high.
- Faster, more responsive common space maintenance. Local HOA management is replacing many of the services that were formerly handled by cities or municipalities, including street lighting and road repairs. Live outside an HOA and repairs and upgrades fall under the responsibility of cities whose resources are already stretched thin.
- More control over decisions. Since the amenities in your community are part of a corporation in which you act as a shareholder, you have the right to participate in decision-making regarding upgrades and changes.
- Greater sense of community. Community association management provides a common set of values and builds a sense of community with people who share your lifestyle. HOAs often organize community activities and events that help homeowners get to know one another and create close-knit neighborhoods.
If my community has an HOA, why do we need a community association management company?
Your HOA board is comprised of volunteers who are responsible for handling assets worth millions of dollars–the combined value of homes and common area in your community. They are ultimately responsible for all the decisions that affect the community.
However, skilled professional community association management companies provide invaluable insight and guidance pertaining to complex issues including asset management, financial oversight, legal requirements, and navigating the Davis-Stirling Common Interest Development Act, the state Civil Code that governs condominium, cooperative, and planned unit development communities in California. Management companies also have extensive experience handling tricky communications such as issuing warning notices and imposing fines for residents who break the rules. Working with a management company relieves administrative duties and helps protect the association from liability.
Community association management is designed to bring key benefits to homeowners. Before you decide to purchase a property in a neighborhood governed by an HOA, we recommend looking closely at the rules, requirements and expectations set out in the association’s governing documents. If you find that these guidelines are acceptable to you, joining a community association can be one of the most beneficial choices you can make as a homeowner.
Do you have any other questions regarding community association management? Please call us at (949) 833-2600 or post your question below.