About one-quarter of the U.S. population lives in private communities governed by a homeowners association (HOA). There are many benefits to HOA living. These include amenities, community standards, and home-value retention.
This is achieved in part through HOA fees. The catch-22 is that, while residents enjoy the benefits of HOA fees, people dislike paying them. This makes raising fees even more of a challenge.
Fortunately, there are some things you can do to make the process less painful. Keep reading for some board member advice for raising HOA fees in your neighborhood.
Examine the Budget
The first thing you should do before actually raising HOA fees is to look at your current budget and identify where things have changed. Have there been any recent increases in vendor fees for services like groundskeeping, accounting, or HVAC maintenance? Have new expenses arisen in the recent past that warrant a fee increase?
If so, first ensure that the money is being well spent. For instance, you might compare rates for comparable services. If everyone's rates seem to have increased, at least you will know that the rate is justified.
Solicit Community Feedback on Improvement Projects
If the reason for the fee increase is an improvement project, you should get feedback from the HOA community before proceeding. Note that these are distinct from regular maintenance or repair projects, which should already be in your budget.
These are often things like installing amenities, like swimming pools, community gardens, tennis courts, or gyms. It also can pertain to major, one-time projects, like repaving sidewalks or installing fencing and gates. Regardless of how big or small, knowing that at least the majority of the community is on board will go a long way in justifying the increase in fees.
Consult Experts
The next step is to consult with experts, including accountants, financial advisors, and lawyers. See if any state or local laws, or HOA rules, govern fee increases, including how far in advance you need to give homeowners notice. Get advice on whether the fees are justified and reasonable, as well as how best to put them in place.
If your board does not have this type of expertise, consider hiring a professional HOA property management company to assist. They can ensure things comply with laws and regulations, and that implementation goes as smoothly as possible.
Communicate With HOA Members
The most important thing you can do when raising HOA fees is to effectively communicate to community members the reasons for the increase. Lay out exactly what you all are getting, as a community, for the extra money. This also ensures that you and the HOA board are being transparent about where the funds are going.
Find First-Rate HOA Management Near You
Now that you understand the steps to take to increase HOA fees, you can proceed with confidence. A qualified property management company can further advise you on the steps to take to ensure funding for your HOA while making sure residents are happy with the changes.
PMI PHX SW is a comprehensive property management company serving Phoenix and surrounding areas. We offer a variety of services, including HOA management. Reach out to us today to schedule a free consultation.
