There are many benefits to ownership. Homeowners Associations (HOA) help homeowners realize these benefits. Belonging to an HOA provides homeowners tools they wouldn’t have individually. One of the most popular tools is the ability to manage property to ensure that all properties are adhering to municipal codes and other regulations. Proper property management can enhance property value and allow for better control of assets. There are some pitfalls with property management. These pitfalls can “wreck” you if you’re not careful.
You may be thinking right about now that HOAs can pretty much do property management all by themselves. You may also be thinking that this is part of their job description. HOAs do have that responsibility to their tenants. Some HOAs do quite well in covering property management. For HOAs who handle rental properties, this can be a very time-consuming and frustrating job. Why should an HOA hire a property management company is the question you may be asking yourself right now.
Benefits of Hiring Property Management Companies vs DIY
One of the first and foremost issues HOAs face quite often is tenant or owner noncompliance with rules and regulations. With rental properties, it could be anything from non-payment of fees to criminal activities. HOAs are run mainly by volunteers set up by the community at large with a specific set of rules that everyone in the association agrees to follow.
It is important to understand because most HOAs are run by volunteers that they could run into issues that they have no knowledge. A property management company has the required experience to handle such issues. HOAs do need to be up-to-date on state and federal regulations, so a good property management company can handle these legal issues that are bound to pop up.
Pitfalls of Hiring Property Management Companies vs DIY
There are some unseen pitfalls with property management companies. Property management companies require a percentage of the rental properties fees and will expect to act as a liaison between tenants and owners. Homeowners who are involved with HOAs cite that restrictions set by property management companies sometimes don’t mesh with the community.
This could be a problem if the property management company manages the properties remotely and has no connection to the community. Property management companies that have no clear understanding of the community cause unnecessary issues.
A good combination: a HOA Property Management Company
HOAs do have the community’s best interest at heart. They provide direction and guidance for homeowners by ensuring the safety and well-being of its residents. A good combination of an HOA and a property management company can be an effective and powerful incentive for residents. Property management companies can help screen potential tenants and provide support for HOAs. Some HOAs have realized reduced maintenance and repair costs. Preventive maintenance increases the value of the properties and reduces taxes. HOA property management companies can provide owners with peace of mind by helping HOAs manage properties effectively.