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HOA vs HOA Management: What’s The Difference?

If you’ve used HOA and HOA management interchangeably, you’re not alone. The terms can perplex those who have never heard of them and even some who are already familiar with them. So, what exactly is the difference between HOA vs HOA management?

In this article:

HOA vs HOA Management Explained

HOA and HOA management — despite sharing the same word, these are two distinct terms. If you’ve ever served on an HOA board, you’ll know what separates one from the other. However, if you’re new to the world of HOAs, you’re likely to get them confused. Let’s break down the definitions of each one below.

What Is an HOA?

Businesswoman covering face using a white paper sheet with drawn question mark, like a mask, for hiding her identity. Isolated on yellow wall background | -To understand the difference between HOA vs HOA management, it’s important to first define what HOA means.

HOA stands for homeowners association. These are organizations formed within a planned community, subdivision, or condominium. HOAs manage the day-to-day operations of a community, ratify and enforce rules for residents and properties, and have the general goal of maintaining property values.

An HOA consists of members of the community. From this community, volunteer members for positions on the HOA board of directors. This HOA board is responsible for all the operations, including financial management, collection, vendor coordination and payment, insurance, maintenance, and more.

Homebuyers who purchase properties within an HOA community must agree to follow the association’s rules and pay a regular fee in exchange for services and access to amenities.

Of course, there’s only so much an HOA can do. Homeowners associations are guided by a set of governing documents, including bylaws and CC&Rs, that dictate what they can and can’t do, as well as when they can or should do it.

What Is HOA Management?

HOA management, on the other hand, refers to the governance and handling of a homeowners association. It’s something the HOA board does on a daily basis. However, many HOA boards have difficulty keeping up with the demands of HOA management. Since most boards consist of volunteers, they often lack the time to accomplish all the tasks involved in managing an HOA.

This is where an HOA management company comes in. An HOA management company provides various services to homeowners associations. These companies oversee the operations of an HOA and supervise the maintenance of amenities and common areas. Basically, an HOA management company exists to make the lives of HOA board members easier by helping fulfill their duties and responsibilities.

These companies have years of experience and a diverse set of experts at their disposal. Therefore, they’re fully equipped to handle the various tasks associated with an HOA, whether that means collecting dues or planning the annual budget.

Benefits of HOA Management

benefits | hoa vs hoa managementSome of the benefits an HOA management company provides include:

  • Clarity – A professional HOA management company can make sure the HOA’s policies are clear and easy to follow. Such a company can also see to it that all homeowners are kept informed of any updates.
  • Consistency – Uniform enforcement of rules and regulations is integral to an HOA’s success. With professional help, an HOA can ensure no favoritism or bias occurs, making for consistent enforcement.
  • Legal Knowledge – Running an HOA requires a lot of legal know-how, and an HOA management company comes equipped with everything there is to know about HOA laws and policies.
  • Varied Expertise – Management companies employ a diverse range of professionals with expertise in various aspects of HOA management, such as finance, accounting, law, marketing, property management, etc.
  • Vendor Management – Healthy working relationships between vendors and HOAs are necessary, and a management company can help assure that. Professionals know how to de-escalate issues and deal with difficult vendors.
  • Neighborhood Commitment – Homeowners expect a certain level of service from their association and need to know that they’re living in a safe neighborhood. With an HOA management company, you can look forward to a higher homeowner satisfaction rate.
  • Open Communication – Communication between board members and homeowners is vital to keeping a community in good condition. After all, homeowners may have complaints and suggestions they want to voice out, and board members aren’t available 24/7. An HOA management company has the necessary tools and experience to keep an open line of communication at all times.

What Type of Community Should Hire an HOA Management Company?

Typically, whether or not it’s in your best interest to hire an HOA management company depends on the size of your community. Smaller communities tend to turn to self-management since there’s less work involved. On the other hand, larger communities will have a more difficult time conducting business without professional assistance.

While size is one of the deciding factors, there are others that can dictate whether you should join an HOA management company. Consider the following questions as you make your decision:

  • Does your association handle many properties, facilities, and amenities?
  • Do you lack volunteers to run the HOA?
  • Do the volunteers lack the time and expertise to fulfill HOA management tasks?

If your answer to most of these questions is “yes,” then it’s time to partner with an HOA management company. Some associations don’t require full-service management. That is to say that they only need help with specific areas of HOA management. For example, a professional can take over financial management and accounting while the board can focus on the rest.

When deciding how to split the work between the HOA board and the management company, make sure to keep the community in mind. Prioritize maintaining property values and instilling a sense of community above all. These are the things that draw buyers into a neighborhood as well as keep current residents satisfied.

HOA vs HOA Management: In a Nutshell

The difference between HOA vs HOA management is night and day, but they aren’t necessarily unrelated. After all, the latter can’t exist without the former. The goal of an HOA is to serve its community and maintain property values through the HOA board. Meanwhile, the goal of HOA management companies is to help the board accomplish their responsibilities and roles.

Whether or not your HOA decides to hire an HOA management company is up to you. However, there are clearly plenty of benefits of getting professional help.

 

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