Homeownerships

---

Homeowners Association

A homeowners association (HOA) is an organization established by a housing development that is responsible for maintaining shared property and enforcing certain rules and regulations for homeowners. While commonly found in condominium and townhouse complexes, HOAs can also be present in developments with detached residences. The HOA is governed by a board of directors elected by the homeowners within the community. Day-to-day operations and maintenance tasks are often overseen by a property management company. When purchasing a home, the seller should disclose whether it is part of an HOA, and this information can also be revealed through a title search. If the property is part of an HOA, it is advisable to request important documents such as financial statements, meeting minutes from the past two years, bylaws, and covenants, conditions, and restrictions (CC&Rs). 

• Bylaws 

HOA bylaws outline the responsibilities and operational procedures of the homeowners association. Understanding the bylaws can help you avoid unnecessary expenses by knowing what the HOA is responsible for maintaining. For example, if you reside on the top floor of a condominium complex and the roof develops a leak, if the roof is considered common property, it is the HOA's responsibility to cover the cost and arrange for repairs.

• CC&Rs 

The covenants, conditions, and restrictions (CC&Rs) establish rules and regulations regarding what you can do with your home and within the community. These rules may cover aspects such as exterior paint colors, pet ownership limits, acceptable flooring choices, or restrictions on renting out your unit. While the HOA cannot evict you for non-compliance with the CC&Rs, they can impose fines. If you wish to pursue an action prohibited by the CC&Rs (e.g., having a second pet when only one is allowed), you can request an exception from the HOA board.

• Dues 

HOAs collect homeowners association dues to cover the maintenance of common areas. Typically, these dues are paid on a monthly basis, although some communities may collect them annually. It is important not to neglect your HOA dues, as the HOA has the authority to initiate foreclosure proceedings if dues are not paid. If the HOA faces an expense exceeding their available funds, they may impose a special assessment, which is an additional fee that homeowners must pay on top of their regular dues. Imposing a special assessment usually requires approval from the majority of the community, rather than solely the board.

Taking Care of Your Home

When you become a homeowner, you assume responsibility for major repairs that may arise, unlike when you were a renter and could rely on the landlord. This applies even if you are purchasing a condominium or townhouse, as you will likely have some responsibilities regarding maintenance. Properly caring for your home typically involves several key aspects.

• Safety 

Prioritize safety when you move into your new home. Consider changing the locks since you may not have all the keys to the house. Ensure that the home has an adequate number of functional smoke detectors (at least one on each floor and in every bedroom). Replace the batteries in these detectors at least once a year, ideally when you move in, as it is unknown when the seller last changed them.

Other important safety products include carbon monoxide detectors (following the same guidelines as for smoke detectors) and fire extinguishers. Working smoke detectors and carbon monoxide detectors are often required by local or state laws. Work with your real estate agent or home inspector to confirm that everything in the home meets safety codes before finalizing the purchase. Create a fire escape plan that outlines exit routes from each room, and if you live with others, establish a designated meeting place outside the home.

• Home Warranties 

When purchasing a new home, you may encounter options for additional purchases, such as home warranties. While certain types of loans may require a home warranty, it is typically optional for most homeowners. Home warranties are usually one-year service contracts that cover repairs or replacement of major appliances and systems, including refrigerators, washers and dryers, and heating and air conditioning systems. Keep in mind that along with the cost of the warranty, there is usually an additional service fee each time a provider is called to address a covered appliance or system issue.

It is essential to carefully consider the cost of the home warranty compared to potential repair and replacement expenses for the covered appliances and systems. Additionally, conducting thorough research on home warranty companies is crucial. If you decide to purchase a warranty, carefully review all the provided documents to ensure that the coverage aligns with your needs and expectations.

• Addressing Home Energy Efficiency

If you are moving to a larger home, it's important to note that certain utility bills may increase. However, as a homeowner, you have the advantage of being able to make improvements that enhance the energy efficiency of your home, helping to offset these increased costs to some extent. Keep in mind that if you reside in a condominium or townhouse, you may need approval from the HOA for exterior-related projects.

Two significant projects that can lead to substantial savings involve ensuring proper sealing of windows and doors, as well as adequate insulation for walls, pipes, and heating and cooling systems. Consider taking advantage of any free or low-cost energy audit services offered by your utility company. These audits analyze energy consumption within your home, identify any areas of energy loss or drafts, and provide specific recommendations for energy-saving improvements. By implementing these suggestions, you can optimize the energy efficiency of your home and potentially reduce utility expenses.