Does a Property's HOA Pass the Sniff Test?

Since today's buyers are already dealing with higher rates and prices, you'll want to assist them with another cost: a property's homeowners association or HOA.

Membership in an HOA is mandatory for residents, with fees paid to maintain shared areas such as pools and landscaping. Although HOAs are a common part of condo and townhome lifestyles, a growing number of single-family homeowners are paying HOA dues.

HOA fees vary widely and may increase with little notice. There are also a few stories of fanatical HOA boards using fines or even foreclosure threats to enforce unpopular rules.

While buyer's agents aren't required to discuss a property's HOA, it's smart to offer guidance if needed.  Here are some tips to share:

  • Ask for copies of all HOA covenants, bylaws, rules and regulations, and meeting minutes.

  • Research the HOA's budget and reserve funds, and how often it has raised members' fees.

  • Search the county website for HOA-filed liens, judgments or foreclosures.

  • Look at the HOA's attorney fees. Excessive amounts suggest that the board is having legal issues, creating rules opposed by members, or both.

  • Attend an HOA meeting, if possible, to watch interactions between management and members.


* Specific loan program availability and requirements may vary. Please get in touch with your mortgage advisor for more information.