Doing Without a Management Company

I don't know the statistics, but the situation you describe is not uncommon.

My thought on this is how dare the homeowners expect volunteers to perform work that they (the homeowners) would otherwise have to pay for! Then I say shame on the board of directors as no one demanded that they volunteer to be groundskeepers. My advice to the board is to notify the homeowners that the free ride is over, raise the assessments to pay for all the services required, and hire someone to perform the work that the board is now doing for free.

Volunteers are best used for short term items with a definite ending date, such as planning the annual meeting. Using volunteers for day-to-day work that never ends is a bad idea. My POA has done this (and continues to do it) and the result is invariably a board member (or other volunteer) blowing up because he feels that his contribution of his time is not appreciated. We have lost some very talented people because they resented being used by the rest of us.

I fully understand that no one on the board wants to raise assessments, but that's the job description and if one is not willing to be unpopular then one should not be on the board.

We have an onsite Building Manager that accepts $250.00 a month. But she recently told me she did not know what she was getting her self into when she applied for and accepted the position. She doesn't do all the work, but she gets bids for work that needs to be done and presents these bids to the Board.

We had to raise the fees this year. We gave plenty of notice because they won't be raised until June. One lady told me she was going to move and lease her unit and that she was encouring others to do the same. She then said "You people will be sorry when you are the only ones here.

Where she can move for under $300.00 a month and get what she gets here I would like to know. I might move if she finds such a place. Even with the 7% increase no one will even be paying $300.00 a month in fees. Of course I have a mortgage so my total monthly bill is higher what most people who live here pay.

We are a 130 lot Association and have been self managed from the beginning (now going on 33 years).

We do have an independent contractor doing bookkeeping services. The collect the mail, track assessment payments, makes deposits and sends out the 30 day late notices (60 day and 90+ day are sent by the Treasurer). Additionally they issue the disclosure packages (required by VA law) and maintains the membership list. For doing this work, we are billed on a monthly basis and it works out to a little more than $2.50 per unit per month.

Volunteers sever on the Board and the architectural committee. This has worked out well for us.


I would say it's more common than you think. However, for Condominiums or large Associations it's more common to have management companies.


The lack of volunteers (for various reasons) is faced by all Associations. Having a management company doesn't require less volunteers. It may minimize the time needed to do the volunteer job.

You will still need to have a Board of Directors. The Board will still have to oversee the management company. The Board should still be the one's paying all bills. The Board or committee should be the ones approving or disapproving applications for changes to each property. The Board will still have to deal with the issuing of any fines or hearings over infractions of the covenants/rules.

I would suggest looking for an independent contractor rather than a full blown management company. It's typically less cost and if you advertize it within the development first you may be able to hire a member for even less than you expected (of course it depends on what you want them to do).

Hope this helps,

Tim

If you want to be self managed after transition then you may want to consider just using your own attorney (hired by homeowners and not declarant). Remember that sometimes to make changes down the road may be difficult to get everyone to agree, if needed.

Also, I have seen some mortgage paperwork which lenders will note that for HOA to change from mgmt co to self managed needs lender approval. A thought to consider and ask your homeowners and the attorney.

Hi John:

You also might consider having a professional inspection to check the items installed by the developer and which the HOA has responsibility to maintain to insure has been done correctly. There potentially could be statute of limitation come into play if there are problems encountered down the road.

I vaguely remember some post in the past one where a developer installed the siding on the condo building the wrong direction. Roll forward 20-30 yrs later and they were now encountering some nasty moisture issues and costly repairs, which may have been avoided if a proper inspection had been done in the past.

Just in case you have not received from any previous post here is a document Roger has posted before regarding transition. If you already have it then it also possibly can help others reading this thread in the future.

Kathy

Thanks for your reply.

I believe the answer depends on the size, complexity, issues, etc. an HOA has. The larger they all are and the less experienced/knowledgeable its members are, the more a professional management company is needed. Let us not forget that the management company works for the BOD thus they are generally reflecting the attitude of the BOD, even when one does not like it.

In my personal situation, I am concerned about the transition from the developer to we owners and the experience/knowledge of our members then I am about our size, complexity, etc.

John