How To Run An HOA Community With Great Success

“How can I have a successful HOA community?” As an HOA board member, you have most likely asked this question — regardless if you’re newly-elected or tenured. Admittedly, running a community is hard and very challenging. However, if you have a solid foundation, it’s possible to achieve great success. To guide you through this process, here’s what you need to know about how to run an HOA successfully.

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“How can I have a successful HOA community?” As an HOA board member, you have most likely asked this question — regardless if you’re newly-elected or tenured. Admittedly, running a community is hard and very challenging. However, if you have a solid foundation, it’s possible to achieve great success. To guide you through this process, here’s what you need to know about how to run an HOA successfully.


How to Run an HOA

What makes a good HOA? There are so many possible answers to this question. So much will depend on the type of community association you have, your homeowners, your assets and facilities, and so on. However, at the very base, a successful community has several traits or characteristics.

Here are important things to consider if you want to run an HOA successfully.


1. Build a Competent HOA Board

hoa board | how to start an hoaHow do you even begin to run an HOA? The answer is: You need to build a competent HOA board of directors.

As the governing body of your community, board members should have a working knowledge of community association management. They must be able to fully understand your governing documents to make informed decisions.

When looking for potential candidates for the HOA board, look for homeowners who have leadership qualities, communication skills, and management experience. You also want people who are strategic, reliable, proactive, and collaborative.

How many board members should your HOA have? It varies from association to association, but it can be anywhere from three to seven board members. Many HOAs will need a board president, vice president, secretary, and treasurer. Though, it will still depend on what your bylaws say.


2. Fulfill the Fiduciary Responsibility of HOA Board Members

To have a successful HOA community, board members must always put the community and its members first. As a board member, you should always remember your fiduciary duty to the association. This means you have a legal obligation to make reasonable decisions for the best interest of the entire community.

Fiduciary duty encompasses board member responsibilities such as creating the annual budget, preparing and participating in board meetings and other community events, enforcing HOA rules and regulations fairly and even-handedly, avoiding conflicts of interests when it comes to community matters, and fostering a sense of community among the homeowners.

Although a desire to better your community should be enough motivation, don’t forget that breaking your fiduciary duty as a board member can lead to legal issues.


3. Involve Community Members

The HOA board cannot run a successful community on its own. You will need the involvement and cooperation of homeowners. This not only makes community management easier and manageable but working with like-minded people also makes the experience more fun.

While it’s true that the HOA is the governing board and homeowners are required to follow HOA guidelines, it is possible for both parties to collaborate and work together. Your homeowners are valuable resources; their experience and expertise can help the community function optimally.


4. Have a Business Mindset

Business Mindset | how to start an hoaIf you want to know how to run an HOA successfully, you need to run it like a business. HOA board members should know their roles, duties, and responsibilities.

They should also be strategic and logical when making decisions on behalf of the community. Always think about the mission, vision, and values that your community upholds.

HOA board members also have to stay on top of community matters such as regularly preparing financial reports and statements, scheduling maintenance and repairs, collecting HOA dues, monitoring insurance deductibles, and so on.

When these things are properly taken care of, the association will be able to operate smoothly and efficiently. This, in turn, paves the way for the community’s success and growth.


5. Hold Productive and Concise Board Meetings

A successful community has productive and concise board meetings. HOA board members should keep in mind that these meetings are not discussion forums or planning sessions. It’s a place to conduct official association business.

Therefore, boards should always come prepared to board meetings. Study the board meeting agenda and relevant materials ahead of time. If you have questions, ask them before the day of the meeting.

Just because you have a short board meeting does not mean that you were not productive. An organized board meeting only means that every member came prepared and is ready to make decisions. To run an HOA successfully, encourage board members to stick to the agenda and express thoughts as concisely as possible.


6. Fair and Consistent Rule Enforcement

Enforcing HOA rules and regulations is one of the most difficult aspects of community management. Even though everyone knows the homeowner association guidelines and governing documents, you will still have homeowners who do not fully comply.

You can lessen this by having fair and consistent rule enforcement. If homeowners see that the board is playing favorites, the more they will refuse to comply. Selective enforcement can also lead to legal troubles if the board is not careful.


7. Communicate Openly

communication | how to run an hoaCommunication is also essential for a successful community. Residents have a right to know what’s going on in their own neighborhood.

Therefore, your HOA board should consistently provide members with updates on all non-confidential community matters.

Of course, transparency is an equally crucial element of a well-run HOA. Board members should be forthcoming about the annual operating budget, the association’s income and expenses, and the reserve fund.

Residents should be kept informed on any projects and financial transactions. After all, homeowners pay a regular fee to the association, so they should know where their money is going.

Without this level of involvement, homeowners may feel left in the dark, which can cause discord between the board and its members.


8. Collaborate with a Community Management Company

Even if you already have the most competent board of directors, the HOA can always benefit from the services of a community management company.

Board members are volunteers so they won’t always have the time or expertise to deal with community matters, especially time-consuming tasks like accounting, collections, and homeowner communications.

If you have an HOA manager, they will be able to take care of essential community tasks. Not only that, but an HOA management company also has access to resources and technologies that board members do not. They can provide software and programs that make community management more seamless, cost-efficient, and effective.


9. Use an HOA Software

How do I self manage my HOA? If an HOA management company just isn’t in the cards, consider investing in a self-managed HOA software instead. An HOA management software can shoulder much of the time-consuming administrative tasks as well as the burden of keeping up with requests, accounting, and collections.

Many homeowners associations feel apprehensive about buying or subscribing to HOA software, usually due to the cost involved. But, with how much time, money, and trouble a software can save you, it will practically pay for itself in the long run.


How to Start an HOA Community

community | how to start an hoaWhile some HOAs struggle to run the community, others have yet to even start one. If you’re interested in forming an HOA in your neighborhood, consider the following points:

  • Know the Law. There are many federal, state, and local laws that you must follow when forming and running an HOA. And, it’s imperative that you familiarize yourself with these laws to avoid getting into legal trouble. In fact, it’s best to hire an attorney to help you establish your association.
  • Gauge Interest. An HOA is nothing without members. Make sure to gauge local interest and ask potential members what they want in an HOA.
  • Assemble a Team. You can’t establish a homeowners association alone. It takes a team of skilled individuals who are all committed to making this a reality.
  • Craft Your Governing Documents. No HOA should be without its governing documents. Seek the help of an attorney when writing your articles of incorporation, bylaws, CC&Rs, and operating rules.
  • Register Your Association. Although the primary function of an HOA isn’t to make a profit, it’s still legally recognized as a corporation. That means you will need to register it as a non-profit corporation or LLC.
  • Get Insurance. Insurance is one of the most important assets of any HOA community. Therefore, make sure to purchase the proper insurance policies early on.
  • Elect a Board. After establishing your association, it’s time to elect your first board members. The election process should be outlined in your governing documents, though it usually involves nominating candidates and voting.


How to Create a Strong and Healthy HOA Community

Now that you know the basics of creating and running an HOA, you’ll be able to create a strong foundation for your own community. However, the work doesn’t end there. Running an HOA community requires concerted and continuous effort, especially for the board members.

It’s important to conduct an HOA health check to measure the performance of your community. But how to evaluate an HOA? It’s more than just looking into the financials of your association. You also want to consider overall HOA operations, as well as the satisfaction level of the people living in your HOA community.

Here are some ways that you can create a strong and healthy HOA community:


1. Monthly HOA Financial Reports

Monthly financial reports are crucial to the success of an HOA. By conducting monthly assessments, the board can ensure proper community association management. HOA financial reports include account ledgers, balance sheets, income and expense statements, budget comparison reports, check register sheets, and bank reconciliation statements.

By looking at these documents each month, the board members will have an easier time monitoring the financial health of the community. You’ll be able to see errors or anomalies early on and avoid financial mistakes that can end up costing your HOA greatly.

If you have HOA software or employ an HOA management company, they can help create monthly financial reports that are organized and easy to understand. This makes it easy for board members to make better and more informed decisions for their community.


2. Yearly Assessments and Updates

To have a successful and healthy community, board members must also conduct yearly assessments for HOA operations. This helps check if the HOA is still running according to its mission, vision, and strategic objectives. If not, the yearly assessment will help you adjust operations and ensure that it is aligned to both short- and long-term HOA goals.

Crucial HOA assessments include the annual audit, which looks into your current finances; the annual reserve study update, to ensure that reserve estimates are still correct or appropriate; and annual site inspections, which help prevent costly maintenance issues. Vendor evaluations at the end of the year are also important. These help the HOA see whether a contract is worth renewing or if the HOA should look for new service providers.


3. Homeowner Feedback

One of the main goals of an HOA is to ensure that homeowners are satisfied with their community management. And so, it’s only right that you ask for their feedback. It’s impossible to have a strong and healthy community if your homeowners are not happy.

Homeowners can give insight into HOA operations, particularly when it comes to covenant enforcement and board performance. If they have valid concerns, the board should make it a point to investigate and find the best solutions.

By keeping communication lines open, homeowners will also feel that their voices are heard and valued. It might even encourage them to participate more in community events. They can join HOA committees and lend their expertise, which can be very beneficial to your community in terms of growth and success.


4. HOA Projects that Increase Value

If you know how to run an HOA with great success, then your finances should be in order. This, then, makes it easier to invest in HOA projects that increase value — not just property values, but also when it comes to a sense of community.

There are plenty of inexpensive ways to increase property values. Regular pressure washing the exterior surfaces and maintaining landscaping can already do a lot in enhancing the appearance of your community. Meanwhile, sustainability efforts such as investing in energy-efficient technologies can ensure the long-term growth of your HOA.

Further, the HOA can create regular events and activities for the homeowners. This allows homeowners to get to know their neighbors better, which helps increase HOA security. A welcome party for new homeowners is also a popular activity. It shows your new members that your community is a great place to live in.


Learn How to Run an HOA Effectively

Being an HOA board member is so much more than just enforcing rules. Sure, rule enforcement is important but you should also make it a point to get to know your community. Collaborating with homeowners can help board members make better, more informed decisions that benefit everyone.

It will take more than these nine tips to run an HOA with great success. However, as long as you keep all these considerations in mind, the HOA board will be able to create a solid foundation for successful community management.

An HOA management company can significantly make the board’s job easier by taking over day-to-day operations. Look for the best management company today using HOA Management’s reliable online directory.



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