You've found the perfect house in the perfect location. The price is right, and you're ready to make an offer. The realtor mentions that there are HOA fees associated with this property, and you're not really sure what that means. Before you dive in head first, make sure you understand what an HOA fee is and what it means to you.
HOA stands for Homeowner's Association. HOA fees are monies collected by the homeowner's assocation to maintain and improve the community in which you live. HOA fees can be collected at different times, the most common are monthly or yearly. The amount of the fees can vary significantly depending on what they are being used for.
HOA fees can cover many expenses. Most of them are related to the maintenance of the shared spaces of the neighborhood. They can include lawn care, snow and trash removal. Some HOAs might cover utilities for your home. Some collect funds in advance of a need that might come up later, such as resurfacing a road or a repairing a roof on a common building. If you live in a larger community, you may be asked to use your HOA to pay employees as well.
It's important to remember that no one profits from HOA fees. All the money is used for the good of the community. The board members that decide the amount of the fees also have to pay these fees.
As important as HOA fees are, they do add to the cost of your home. When budgeting, you must remember to add these in to your expenses to make sure you can still afford the home. With all the information, you can make a wise choice on purchasing, which will add less stress to your life!
As always, if you have more questions on HOAs or any other aspects of buying or selling a home, please contact the experts here at Hills Real Estate Team for answers. We would be happy to help!