If you’re like many HOA management pros, dues can be a somewhat sticky subject for you. Because they’re tied so directly to resident happiness and neighborhood success in many ways, you may even be hesitant to increase or decrease them, lest you disrupt the careful financial and social system that the board before you has worked to construct!
That being said, taking control of and responsibility for what you ask of your residents is critical to running a neighborhood that can accept and work with change. So what’s a reasonable amount to ask each household to pay?
While a specific number can best be given at a one-on-one property management services consultation, Gassen will provide a few factors to consider below.
What Is the Area Average?
According to QuickenLoans, a mortgage company, “A monthly HOA fee could be less than $100 or more than $1,000. Typically, they’ll be $200 – $300 per month.” That’s a huge range, so how do you know if you’re overcharging—or undercharging—your residents?
A handy benchmark is the average rate for neighborhoods of your caliber in your area. While every HOA is an individual, Bankrate, a provider of financial and home-buying resources, states that location is a huge influence in how much a property management company can and should charge. In-demand locales, for instance, might have higher dues to compensate.
What Amenities Does the HOA Offer?
Dues go in part towards paying for amenities, so it’s only logical that the more of them an HOA has, the more it’ll need to charge to maintain them. An HOA with free WiFi and a community pool, for example, can ask for a bit more in dues than a neighborhood that doesn’t have these things—when all other variables are held constant, of course.
Are you Keeping Up With the Neighborhood’s Needs?
HOA Resources states that “maintaining artificially low dues might appease residents in the short-term but will inevitably catch up with an association.” You shouldn’t keep dues low if they need an increase, because the sting of that increase in the future can be hard for homeowners to handle—and any approval those homeowners had of the board while dues were low will likely be short lived.
Choose other, more financially sensible options if you want to keep dues at a reasonable level while also staying fiscally sound as an HOA. Check out a few recommendations on our local property management services blog!
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We have the comprehensive expertise your HOA needs to be the best it can be. Reach our Eden Prairie office today at 952-922-5575.