HOA management can be difficult for the board of directors. They need to balance their responsibilities with their careers and personal lives. For this reason, many HOAs opt for professional homeowners association management.
What Is HOA Management?
HOA management refers to the management and governance of a homeowners association. It includes all the tasks the board of directors needs to do to keep the HOA running. These include hiring and supervising vendors for repairs and maintenance, collecting dues, enforcing rules, and financial management.
What Do HOA Management Companies Do?
Homeowner association management companies provide services that take the burden off the board’s shoulders. They help the board by taking care of daily responsibilities. Here are some of the most common HOA management services these companies provide:
- Financial Management. HOA management companies handle everything from budgeting to bookkeeping, accounting, and preparing financial statements.
- Collections. Management companies collect dues from residents, track payments, charge late fees, issue notices, and handle delinquencies.
- Maintenance. Management companies receive maintenance requests, schedule maintenance work, and collaborate with vendors to keep the community in shape.
- Community Services. Management companies schedule and handle community services such as lawn mowing, garbage disposal, and snow removal.
- Vendor Management. Professional companies manage vendor relationships and vendor payments. They can oversee the work, terminate vendors, or look for better alternatives when necessary.
- Project Management. HOA management companies can help communities manage large projects such as playground installations, building construction, and amenity construction.
- Rule Enforcement. Management companies oversee violation inspections, send out violation notices, and issue penalties.
- Administration. HOA management companies schedule meetings, create and send out agendas, and oversee them.
- Communication. Professional companies handle all communications, including announcements, newsletter administration, and social media management.
- Dispute Resolution. HOA management companies can handle disputes between members.
- Legal Compliance. Management companies help communities comply with local and state laws to avoid liability.
Who Does What: HOA Board vs HOA Management Company
A professional management company can handle most of the board’s operational and administrative duties. However, where do they draw the line? How do you know who has which responsibility if the HOA board hires an HOA management company?
It’s important to understand that the board always has the final authority at the end of the day. The management company is only the board’s vehicle to implement the rules and conduct operations. It has no decision-making power. This applies to every area of community management.
For example, when it comes to rule enforcement, the management company only has the power to enforce the rules. However, the authority to create policies remains with the board. The same is true when it comes to late fees and fines. All the HOA management company can do is process the fines, implement the policies, and send notices. It’s up to the board to decide whether to waive the fines or late fees.
Likewise, the board has the power to approve and set the annual budget, approve expenses, approve maintenance requests, approve hiring decisions, set fee schedules and amounts, and create rules and policies.
How Much Does Professional Management Cost?
Professional community association management charges different fees depending on the services provided. The cost will be significantly lower for a community that only needs financial management services than for an association that needs full-service management.
Typically, management companies will charge a flat fee based on the number of units in the community. Homeowners associations should expect to pay $10 to $60 per monthly unit. However, some HOA management companies charge a percentage of the membership dues.
Nonetheless, larger HOAs with more units should expect to pay more. This is because there are more common areas to maintain, employees to oversee, and residents to manage. Likewise, management companies may charge more for communities with more amenities or are more complex.
Self-Management vs. Professional HOA Management
Self-management can be difficult but not impossible for some communities. Which is right for your HOA community? Consider the pros and cons of each before making a decision.
Firstly, self-management can be a cost-effective way to manage a planned community. After all, there’s no added cost of paying for professional services. Moreover, self-management offers more freedom as the homeowners can take care of everything themselves. They do not need to adjust to outsiders’ perspectives or management methods.
However, self-management also comes with several risks. Firstly, one of the biggest risks is a need for volunteers. Homeowners often don’t have the time to contribute to the community or participate in committees. Self-managed HOAs rely on unpaid volunteers, so a lack of willing residents may be a major issue.
In addition, self-managed HOAs often struggle with consistency and experience. The board often needs to have the right skills or resources to handle the needs of an HOA. They might need to learn about community governance, financial management, or legal requirements. Thus, they may make poor decisions that negatively affect the community. They might even face more lawsuits as they’re more prone to neglecting upkeep and legal compliance.
Furthermore, one of the biggest benefits of professional management is that HOA management companies often have good connections. They know which vendors provide high-quality services and already have established relationships with them. Hiring the right vendors is vital as it can improve the community’s satisfaction and reputation.
Finally, self-management may not be the right choice for larger communities. Even if the community has a large HOA board, there might be too many obligations to keep up with. Choosing self-management might just overburden the board and lower morale.
Call a Professional Today!
HOA management is challenging, especially if you don’t have the right experience or expertise. We recommend hiring a professional management company to help your community. The right company can make all the difference in maintaining property values and ensuring your neighborhood is a good place to live.
Are you in search of an HOA management company in in Southern California? Personalized Property Management is the best in the business! Call us now at 760-325-9500 or contact us online for more information.