HOA Popularity In 2021: Do Homebuyers Like HOAs?

More and more buyers are choosing to live in communities managed by homeowners associations nowadays. But, what exactly are the factors that continue to contribute to HOA popularity? Is this popularity here to stay?

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More and more buyers are choosing to live in communities managed by homeowners associations nowadays. But, what exactly are the factors that continue to contribute to HOA popularity? Is this popularity here to stay?

 

The State of HOA Popularity in 2021

The COVID-19 pandemic crippled several industries, but the real estate industry is not one of them. As the demand for homes rises above the supply, the housing market has managed to remain strong throughout the United States. Many of these homes belong in communities run by homeowners associations.

At the start of this year, homeowners and condo associations were projected to grow by a whopping 4,500, reflecting a 1.3 percent increase from the previous year. This is according to the Foundation for Community Association Research, an affiliate of the Community Associations Institute. In the United States alone, about 25 percent of all houses are managed by community associations. This equates to 73 million Americans.

 

Why Do Homebuyers Like HOAs?

You may have heard horror stories involving condominium or homeowners associations in the past. But, these horror stories typically represent the minority. In fact, in  2020 Homeowner Satisfaction Survey, 38 percent of residents said they are more interesting in buying homes in community associations. Out of those HOA residents surveyed, 40 percent rated their experience as very good, while 30 percent rated their experience as good.

When you examine the results of this survey, it becomes glaringly obvious that living in a homeowners association is a choice voluntarily adopted by many residents. Those looking to purchase a home continue to opt for HOA-managed communities for many reasons, including but not limited to the following:

 

1. Stability

hoa popularity in 2021Homeowners and homebuyers love the stability that comes with living in a community association.

As common elements deteriorate with time, residents know their investment is in safe hands because of the association’s reserve fund. This fund contains contributions from residents made over the years, set aside for the future cost of repairs, replacement, or upgrades.

A homeowners association also means consistent maintenance and care when it comes to common areas. In gated subdivisions, the HOA normally ensures maintenance over roads, sidewalks, and landscaping. There are also rules in place to direct what residents can and can’t do. All of this directly impacts curb appeal and property values. And, according to the survey, 94 percent of homeowners believe their HOA’s rules preserve property values.

 

2. Privatized Amenities and Services

When you live in a community association, you might find that certain services no longer fall under the jurisdiction of your local government. Developers purposely do this to transfer the responsibility from local governments to the association, often acting under instruction from the local government itself.

The services commonly provided by community associations include garbage collection, snow removal, road maintenance, stormwater management, and recycling. Some may also provide landscaping services.

Additionally, homeowners associations usually build common facilities or amenities that members can use. While these amenities can differ from one community to another, they normally include swimming pools, fitness centers, clubhouses, and even tennis courts or private parks.

Residents can easily walk or drive to these amenities, show their identification, and gain access. More often than not, the amenities are exclusive to members only.

 

3. A Collective Effort

Much like a government, every condo or homeowners association has a set of elected residents who make decisions for and act on behalf of the community. This set of officers, known as the HOA board, assume their positions on a voluntary basis.

An HOA board oversees the day-to-day operations of the association. Its members perform several tasks, including choosing vendors for various services, preparing the annual budget, creating and enforcing rules, and resolving homeowner disputes. Board members also take time out of their busy schedules to attend board meetings and annual membership meetings.

Serving on an HOA board is no easy feat. It takes time, patience, and a lot of effort to pull off. Experience is not typically necessary, though it can be a plus. Moreover, as volunteers, board members receive no compensation for serving the community.

The presence of a governing body may turn off some people to a homeowners association. But, for many others, it is an attractive quality in a neighborhood. With an HOA board, the community can function with relative ease.

While there is always a risk of poor management, it is not as common as you might think. In fact, 89 percent of those surveyed believe their board serves the best interests of their association.

 

4. Low-cost Entry

Low-cost entry to housing is another reason why HOA popularity continues to grow. Since the 1960s, townhomes and condos have been affordable housing options for first-time buyers. In addition to their relatively affordable price tag, these homes also have location on their side. More often than not, you will find these low-cost homes in neighborhoods where more expensive single-family homes typically reside.

 

What Is the Projection for HOA Popularity in 2022?

hoa popularity in 2022No data is yet available to make an accurate projection for the popularity of HOAs in 2022. However, there is reason to believe that HOAs will remain a favored option among many homebuyers in the coming year.

The popularity of HOAs has been trending upwards in the last few years, and it is likely that this trend will persist. Homebuyers will continue to consider the same factors that have influenced numerous homeowners in the past. After all, buying a home is one of the biggest investments in any person’s life. As such, you would obviously want to protect that investment in the best way you can.

 

From Here on Out

HOA popularity has risen over the past few years, and 2021 is no exception. This year has seen a growth in new community associations as well as homeowners living in such neighborhoods. While gaining access to privatized amenities and services is nice, it is really the role that HOAs play in preserving property values that have the strongest influence on a homebuyer’s decision-making process.

Homeowners associations clearly offer a lot of benefits, but they can be difficult to manage when you lack time or expertise. Find an HOA management company in your area today with the help of our comprehensive online directory.

 

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