One of the many responsibilities of a homeowners association (HOA) or a community association is governing the community. They create the CC&Rs, they implement rules and guidelines that have been decided upon by the governing body, they determine the penalties for those that have been non-compliant with the community’s rules, and most importantly, they may decisions regarding certain matters that affect the community.
In this article, you will learn how to choose an association management company and the importance of doing so. If you live in a community, it is important that you take pride in allowing yourself to get involved with these kinds of decisions because this will affect you in the long run. On another note, if you are part of a community association, all the more reason that you should pay attention to what is being discussed in this article.
With these in mind, let us start with one of the most basic questions in figuring out how to select an HOA management company – why is there a need to do so in the first place?
The Importance of Selecting the Right HOA Management Company
If you are already part of a community association, this may come as a form of confusion. Why is there a need to hire a community association management company? Well, while HOA oversees the maintenance of the common areas within the community, there is a high chance that you will need help in the decision-making processes, the implementation of certain rules and guidelines, the hiring of third-party vendors, and the adoption of policies within the community.
You and the members of your community’s HOA may already be doing a good job at it; however, there are certain cases that will truly make you say that a community association management company is what you need. Here are some of the risks that may come up when having self-managed HOAs:
Consistent Lack of Volunteers
One of the top reasons as to why an HOA may want to hire a community association management company is that there is no one willing to step up to perform the said responsibilities. Do note that being part of the HOA board does not guarantee you any financial return. This is an unpaid position. Nonetheless, even the most dedicated neighbors will find themselves paying more attention to things that will earn them a living.
Lack of Consistent Governing Strategies
Another risk with having to manage your own community’s HOA is the lack of consistency in governing. Whenever particular volunteers are behind the laws, there are times when convenience will support. As a result, the risk of having favoritism, politics, power play, and unfair treatment are not far behind.
The Possibility of Increased Lawsuits
Stemming from the previous point, these unlawful acts will not go unnoticed. When there is a clear form of discontent from the community, an increasing number of lawsuits are possible. Properly managing the community entails professionalism. Without proper management, it is actually not uncommon for an HOA to fail a complaint with the local, federal, and state laws.
How to Select a Community Association Management Company
To save you from the stress of picking the right HOA management company, check out this list of tips on how to select a community association management company:
Consider the Community Size and its Complexity
The HOA board should first go through a number of items that should be considered before settling on a management company. It is crucial to consider certain factors and resources to ensure that the firm you hire will be effective at its job.
With that in mind, start by considering the community size as well as its complexity. This is important because it will also determine the necessary services to be performed by the firm. The larger the association, the more diverse and complex it will be. Thus, the more sophisticated the HOA management company should be.
Consider the Community’s Financial Resources
Another important factor that will greatly affect your decision in finding the right HOA firm to manage your community is the available financial resources by the community itself. If you have a small number of funds allocated for the fees of the community association management company, you should reconsider choosing big-name companies.
Consider the Availability of Volunteers
As mentioned earlier, the number of volunteers within your community who are willing to fulfill the functions of the HOA board can also affect the need to hire a community association management company in the first place. Even though there is a high number of volunteers within the community, there is still a chance that you may need to hire a firm.
Figure out the Services of the Firm
There are a number of community association management companies in today’s market. Narrowing down your search entails screening those that provide services that will help you meet the goals and objectives of your community. Each company has its own set of services. With that in mind, it is important to discuss with the board what the community needs and proceed from there.
Nevertheless, some of the most common services provided by an HOA firm include administrative services, financial services, customer care services, and communication and maintenance.
Discuss the Contract Flexibility
Some of the questions that heavily deal with this category include the possibility of being tied into an agreement that will not allow certain changes. It is important that the community association board discuss these possibilities as well as the restrictions that may be involved with a particular firm.
Other questions that may be involved are those that have the potential to lower the cost; this includes an initial discount offering. If your community lacks financial resources, this may be a good start.
Consider the Values and Beliefs of the HOA Management Company
It is important that you consider the values and beliefs of the community association management company. In fact, it’s important that it adheres to what your community believes in as well. Since the firm will be heavily involved with decision-making processes, it is important that they see eye-to-eye with what the members of the community believe in.
Final Thoughts on Hiring an HOA Management Company
In the end, going through a long list of HOA firm is necessary. To effectively narrow down your search to the best candidate, you must consider all of the factors that may affect the members of your community. You can save a lot of time and save yourself from confusion by following proven tips.