ColleenW1 (Colorado)
Posts: 6
Posts: 6
Posted:
I'm curious as to know which people on here have a management company OR an individual who acts as a Manager for their community?
Any/all comments are welcome.
Any/all comments are welcome.
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Which is better, Mgt. company OR individual?
Started by ColleenW1 • 11 replies • 1492 views
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TimB4 (Tennessee)
Posts: 21,059
Posts: 21,059
Posted:
We are self managed. We have no one who acts as manager. The Board works together to administer the duties of the Association.
JanetB2 (Colorado)
Posts: 4,219
Posts: 4,219
Posted:
Hi Colleen:
You will usually either have a Property Management Company or HOA Board/Officers mainly in charge of HOA communities. Unless as you posted potentially hiring one individual to manage (which to my knowledge is rare occurrence).
In my local area the ones who started out under HOA/Officers I have found are better off financially with regards to having a larger reserve fund. They operate without a Property Management Company for at least 2-3 years and the money which would have been spent for the management company instead helped grow their “reserve account”. Once the reserve account reaches a level they feel comfortable with to cover unexpected potential repairs/costs they then transitioned to a Property Management Company to relieve some burden from the Board/Officers.
This would also be a decision to make depending upon the size of the HOA community. If you have a small 20-60 HOA community then the time to manage via Board/Officers would be minimal compared to a large 200-500 HOA community. The financial resources for a larger community would better cover the costs of a Management Company more so than a smaller community.
What it will come down to is how big the HOA and how much you want to spend for the extra service.
You will usually either have a Property Management Company or HOA Board/Officers mainly in charge of HOA communities. Unless as you posted potentially hiring one individual to manage (which to my knowledge is rare occurrence).
In my local area the ones who started out under HOA/Officers I have found are better off financially with regards to having a larger reserve fund. They operate without a Property Management Company for at least 2-3 years and the money which would have been spent for the management company instead helped grow their “reserve account”. Once the reserve account reaches a level they feel comfortable with to cover unexpected potential repairs/costs they then transitioned to a Property Management Company to relieve some burden from the Board/Officers.
This would also be a decision to make depending upon the size of the HOA community. If you have a small 20-60 HOA community then the time to manage via Board/Officers would be minimal compared to a large 200-500 HOA community. The financial resources for a larger community would better cover the costs of a Management Company more so than a smaller community.
What it will come down to is how big the HOA and how much you want to spend for the extra service.
DavidW5 (North Carolina)
Posts: 565
Posts: 565
Posted:
Our first elected board has just made a significant change. Prior to this we had a management company and an on-site community manager who worked for the company. All other on-site staff were also employees of the company.
We have now directly hired an experienced on-site manager and staff as employees of the association and under the direct control of the board of directors. The contract with the management company was renegotiated and their duties were reduced solely to financials (i.e. collection of dues, payment of invoices, production of monthly financial statements, etc.)
This has both reduced monthly expenses significantly and also given the board better control of association affairs.
We have now directly hired an experienced on-site manager and staff as employees of the association and under the direct control of the board of directors. The contract with the management company was renegotiated and their duties were reduced solely to financials (i.e. collection of dues, payment of invoices, production of monthly financial statements, etc.)
This has both reduced monthly expenses significantly and also given the board better control of association affairs.
ColleenW1 (Colorado)
Posts: 6
Posts: 6
Posted:
Tim, I'm curious as to the size of your community?!
Has anyone ever heard the saying: "To many cooks spoil the broth?" This is how I foresee "several people" trying to run an HOA.
I'm happy to hear about your experience David, but I hope you (plus other community members) keep a realistic view about the FUTURE.
And Janet...If you don't already own your own management company, or are in charge of an HOA, you should be.
;)
Has anyone ever heard the saying: "To many cooks spoil the broth?" This is how I foresee "several people" trying to run an HOA.
I'm happy to hear about your experience David, but I hope you (plus other community members) keep a realistic view about the FUTURE.
And Janet...If you don't already own your own management company, or are in charge of an HOA, you should be.
;)
TimB4 (Tennessee)
Posts: 21,059
Posts: 21,059
Posted:
Colleen,
Since you asked, We are 130 lots, town homes, community built in two sections (about a 27 acre plat). The Association maintains the roads, side walks, 2 playgrounds, 2 entrance signs, a wooden bus shelter and the common area.
The town homes were built by staggering heights and distance from the road so that there are no common roofs and only the dividing wall is shared between neighbors. Therefore, the Association maintains nothing on any individual lot - it is all the responsibility of the homeowner.
We keep 4 continual contracts, common area landscaping (mowing, leaf removal), snow removal, trash/recycling and book keeping. Our bookkeeping services are provided by an independent contractor who checks the mail, records payments of assessments and deposits checks.
All budget, paying of bills, soliciting contract/repair bids, etc. are done by the Board. We have an Architectural committee, three volunteers, responsible for the approval of design changes and initial enforcement of violations. Any fines are handled by the Board.
The Architectural committee doesn't go around looking for violations except once per year when they do an inspection of each lot, usually around May, but will investigate any complaints made by others or take action if they happen to see one outside of the inspection.
Like other communities, we only have about 45% participation from the membership.
Larger communities or any communities that provide more amenities or have less participation would probably need to actually hire additional help. We have been doing this since 1980 when the membership took control of the Association.
Tim
Since you asked, We are 130 lots, town homes, community built in two sections (about a 27 acre plat). The Association maintains the roads, side walks, 2 playgrounds, 2 entrance signs, a wooden bus shelter and the common area.
The town homes were built by staggering heights and distance from the road so that there are no common roofs and only the dividing wall is shared between neighbors. Therefore, the Association maintains nothing on any individual lot - it is all the responsibility of the homeowner.
We keep 4 continual contracts, common area landscaping (mowing, leaf removal), snow removal, trash/recycling and book keeping. Our bookkeeping services are provided by an independent contractor who checks the mail, records payments of assessments and deposits checks.
All budget, paying of bills, soliciting contract/repair bids, etc. are done by the Board. We have an Architectural committee, three volunteers, responsible for the approval of design changes and initial enforcement of violations. Any fines are handled by the Board.
The Architectural committee doesn't go around looking for violations except once per year when they do an inspection of each lot, usually around May, but will investigate any complaints made by others or take action if they happen to see one outside of the inspection.
Like other communities, we only have about 45% participation from the membership.
Larger communities or any communities that provide more amenities or have less participation would probably need to actually hire additional help. We have been doing this since 1980 when the membership took control of the Association.
Tim
DavidW5 (North Carolina)
Posts: 565
Posts: 565
Posted:
Quote:
Posted By ColleenW1 on 01/30/2011 6:31 AM
I'm happy to hear about your experience David, but I hope you (plus other community members) keep a realistic view about the FUTURE.
I'm happy to hear about your experience David, but I hope you (plus other community members) keep a realistic view about the FUTURE.
Colleen, I'm not sure what you mean about keeping a realistic view about the FUTURE. Our community is on very solid financial footing. We have a low delinquency rate on assessments and a robustly funded replacement reserve fund based on professionally prepared reserve study that is undated every 5 years. We also maintain a 10% operating contingency fund.
KcW (Florida)
Posts: 14
Posts: 14
Posted:
In my experince,
MPs are blood sucking, money hungry, I will advise the BOD to do whatever possible to make sure I don't have to work any harder than a tick, non-resident numskulls.
Do your homework to pick a good one, but if you dont have to, stick with doing it yourself.
MPs are blood sucking, money hungry, I will advise the BOD to do whatever possible to make sure I don't have to work any harder than a tick, non-resident numskulls.
Do your homework to pick a good one, but if you dont have to, stick with doing it yourself.
PjW (Virginia)
Posts: 71
Posts: 71
Posted:
Colleen - I live in a 92 townhome section of a larger development that wasn't ever pulled into one HOA (so we have 3 in 1 neighborhood) - anyway - we have a Property Management company - the last time we were self managed, which was before I lived there, it was rumored that there was a lot of stealing of the community money so they got a PM.
It's okay - wish we could afford a different one - we have a communication problem with them.
It's okay - wish we could afford a different one - we have a communication problem with them.
DanielH1 (California)
Posts: 482
Posts: 482
Posted:
I live in a 46-unit HOA, managed by a management company. Before, I lived in a 11-unit HOA that was self-managed.
It's hard to say which is better, though I lean towards the management company.
Self-managed works if there is at least one person (and hopefully more) who is a total workhorse who will work on a weekly basis to get HOA business done. For free. Until the end of time.
That's kind of unfair but there are rare individuals who will do that. And, if you have one or more in your HOA, God bless you!
But, without that, self-managed will devolve into a disaster.
A management company is less high but less low. They've never put the care or time into your HOA that somebody living in your HOA would. But the basics will get done without heroics.
It's hard to say which is better, though I lean towards the management company.
Self-managed works if there is at least one person (and hopefully more) who is a total workhorse who will work on a weekly basis to get HOA business done. For free. Until the end of time.
That's kind of unfair but there are rare individuals who will do that. And, if you have one or more in your HOA, God bless you!
But, without that, self-managed will devolve into a disaster.
A management company is less high but less low. They've never put the care or time into your HOA that somebody living in your HOA would. But the basics will get done without heroics.
RobW (California)
Posts: 279
Posts: 279
Posted:
177 units here (156 condos, 21 townhouses). The complex was built in the mid-70s, and we have for the past 11 years contracted out our management to a large PM firm. Prior to that, we had a succession of onsite managers who worked as employees of the HOA. I remember at least 4 of them in the 24 years I've lived here.
The onsite manager approach did not work for us. It sounds good in theory, in that it would seem logical that you would get better, more personal service, put in practice, the manager is only as good as his or her strengths. The BOD still has to manage the manager, and if the manager is weak on some essential skill, either that task is performed poorly, or the HOA must hire additional employees or outside vendors to fill in the gaps. This can get expensive and complicated. Even when the manager is well-suited for the job, as he or she grows in experience and knowledge, there is an expectation that salary and benefits will increase to compensate for the improved services. But there's a limit to how much the homeowners are willing to pay, and at some point, the manager moves off to greener pastures, and the cycle begins all over again. There are personnel issues that volunteer BOD members may be ill-equipped to handle, also, that can lead to disaster.
On the other hand, contracting with an outside management firm may be just as perilous. Even good managers at large firms are often paid poorly, especially considering the level of responsibility they shoulder. Good PMs who join PR firms often get difficult HOA clients dumped on them, until they have so many clients they can no longer perform well for any of them. Again, this is because most HOA's are not willing to pay what it would really take to have an excellent manager available at any time for any situation that comes along.
The upside of hiring a small firm is that you might get good service, since it will often be one-on-one with the owner. But if the company is being managed properly, the firm will grow, and suddenly you will no longer have that level of care. The upside of hiring a large PM firm is that they will often have multiple resources from which to draw for your needs, but the downside is that turnover is a problem, and you may have a series of ineffectual managers who can royally screw up your documentation, fail to take care of requirements, and land your association in hot water.
I really don't have a good answer for you, except to say that the type of management any given HOA needs is dependent upon that particular HOA. I'm fascinated with the idea of self-management by a BOD. That's something we've never tried, and I can't imagine how it would work here.
Rob
The onsite manager approach did not work for us. It sounds good in theory, in that it would seem logical that you would get better, more personal service, put in practice, the manager is only as good as his or her strengths. The BOD still has to manage the manager, and if the manager is weak on some essential skill, either that task is performed poorly, or the HOA must hire additional employees or outside vendors to fill in the gaps. This can get expensive and complicated. Even when the manager is well-suited for the job, as he or she grows in experience and knowledge, there is an expectation that salary and benefits will increase to compensate for the improved services. But there's a limit to how much the homeowners are willing to pay, and at some point, the manager moves off to greener pastures, and the cycle begins all over again. There are personnel issues that volunteer BOD members may be ill-equipped to handle, also, that can lead to disaster.
On the other hand, contracting with an outside management firm may be just as perilous. Even good managers at large firms are often paid poorly, especially considering the level of responsibility they shoulder. Good PMs who join PR firms often get difficult HOA clients dumped on them, until they have so many clients they can no longer perform well for any of them. Again, this is because most HOA's are not willing to pay what it would really take to have an excellent manager available at any time for any situation that comes along.
The upside of hiring a small firm is that you might get good service, since it will often be one-on-one with the owner. But if the company is being managed properly, the firm will grow, and suddenly you will no longer have that level of care. The upside of hiring a large PM firm is that they will often have multiple resources from which to draw for your needs, but the downside is that turnover is a problem, and you may have a series of ineffectual managers who can royally screw up your documentation, fail to take care of requirements, and land your association in hot water.
I really don't have a good answer for you, except to say that the type of management any given HOA needs is dependent upon that particular HOA. I'm fascinated with the idea of self-management by a BOD. That's something we've never tried, and I can't imagine how it would work here.
Rob
ColleenW1 (Colorado)
Posts: 6
Posts: 6
Posted:
David, The future is the FUTURE, nothing more really. ;-)
WOW, you guys are awesome, there are some wonderful comments here, and lot's to consider.
WOW, you guys are awesome, there are some wonderful comments here, and lot's to consider.
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