Are You a Good Fit for an HOA Neighborhood?

Neighborhoods with homeowners associations (or HOAs) are pretty common. In fact, in 2021, about 66.9% of new homes completed that year were part of HOA communities. 

When there is a homeowners association in your neighborhood, you'll often find more amenities such as parks or playgrounds. The association may also organize activities. However, there will likely be rules about what you can and cannot do with your property, along with HOA fees that have to be paid in addition to your monthly mortgage payment.

Before you buy a home in an HOA neighborhood, it's important to consider what this decision will mean for your future -- and essential to take the time to think about whether you're a good fit for this kind of community. 

Are you OK with people telling you what you can and can't do with your home?

Homeowners associations often have a lot of rules. You may have to paint your house a certain color, maintain specific kinds of plants in your yard, keep your garage doors closed, and avoid keeping an RV in your yard. And this is just a very small sampling of some of the rules you're likely to encounter.

If you feel your blood boiling at the idea of someone telling you that you can't paint the home you paid a fortune to buy in the way you want, then you are not a good fit for an HOA neighborhood. 

How concerned are you with maintaining property values and a certain look in your neighborhood?

The upside of HOAs is that they help maintain property values by ensuring a neighborhood stays nice. The HOA will ensure you don't end up with neighbors who let the house fall into disrepair or who build an ugly home addition you don't want to look at.

If it's very important to you that houses are kept up nicely and if you want to make sure a bad neighbor doesn't hurt your home's value, an HOA neighborhood may be a great fit. 

Do you have extra money for HOA fees in your budget?

You are going to have fees if you live in an association neighborhood. Sometimes, those fees are a few dollars a month. But sometimes they are several hundred or even several thousand dollars a month. 

If you cannot afford to pay for the extra cost of HOA fees, you don't want to move to a neighborhood that requires you to cover this cost. You could find yourself facing late charges and potentially even having your home foreclosed on if you don't pay the HOA as required. 

How important are neighborhood amenities to you?

Most often, neighborhoods that offer amenities such as swimming pools and activities tend to have HOAs. After all, someone needs to maintain all those features and also plan events. If you want these amenities and you want to live in a place where there are community events for you and your kids, an HOA neighborhood may be your best option. 

By considering these key issues, you can decide whether moving to a place with an HOA Is going to make you happy or bother you. Be sure to think about this decision carefully, as once you buy a home in an HOA neighborhood, you're going to be bound by the rules whether you like them or not.