Fee Coverage

Hello,
We moved into our home a little over a year ago and at the time of purchase, we were told there were no HOA dues for our neighborhood. Once we moved in, we got a letter stating that we owe for a past balance. Long story short we got that taken care of by the realtor attorney but my concern is what the HOA actually covers. I recently sent an email asking about what our dues cover and was provided a breakdown. We are not a gated community and are on public streets and have a yearly cost of $2,600 or electricity for the street lights and two small sign lights. We also pay $2,460 a year for grounds maintenance for not even a block worth of trees and grass. The streets are not maintained, we pay for our own grass and trash. We also have no amenities what so ever. There are insurance costs on the breakdown along with postage and management costs. To me (and some of the neighbors) these dues make no sense as we have nothing that should be covered by HOA dues. From what I also hear and have seen is that there has not been any HOA meetings in quite some time. We have not received one letter or announcement about a meeting in over a year that we have been here. Are these dues really necessary for a neighborhood (not really community) that is public and not gated, no benefit to the homeowners and no amenities? I have included a copy of the breakdown they sent me.

Ashlee,

Is your development still being built out (new homes) or has everything been sold?

I'm going to ask a VERY simple question and it is not meant to offend...just meant for thought.

When you looked at this house in your neighborhood- in this subdivision - you saw there were streetlights and 2 signs that had lights as well as a small area of trees and grass. I will also assume there is a landscaped area where the 2 lighted signs are? Also assuming these are the entrance (s) to your neighborhood with the name on the signs, etc.?

Who did you think paid for the electricity for the lights? The maintenance of the areas around the signage?

Now, you also state the HOA dues cover insurance and a management costs, postage and the like.

Who do you think pays for that?? Seems to me your " nothing " that should be covered by HOA dues is actually many things.

I also must ask WHO told you there was NOT an HOA at time of purchase? Is your home new? Did the previous owner tell you there was not an HOA? Your realtor, the title company?

I guess my point here is this: And again, not to offend...but, to possibly help other potential home buyers to ASK MANY QUESTIONS! If the answer you get does not seem reasonable, ask again. I think if you had simply stated " Who pays for the streetlights? " someone may have dug a little deeper. You get the benefit of streetlights, but electricity is not free.

So, the larger point is you have an HOA. Newsflash! Perhaps your next e-mail should be to inquire when the next meeting is or when the Annual Meeting is. Just be warned. In your quest to find out more- you run the risk of taking on a whole lot more than you bargained for.
Best of Luck.

K.

It is definitely not an oddity to have a non-managed HOA. I looked at a house where the monthly assessments was $15.00 and there were absolutely no amenities. The streets were public as well as the streetlights. The $15 fee covered the accountant that was hired to collect the assessments.

$120 a year seems high?

85 properties. See cell a28 in attachment.

Insurance is essential for any HOA.

1. You have to cover the board and committees with D&O otherwise they'd be held individually liable if sued.
2. You have to cover the HOA with liability insurance because in the event of a lawsuit and no insurance, each member would be responsible for costs associated with the defense of the lawsuit and any adverse verdict that found the association liable. Even if the HOA is not at fault - you still have to defend.
3. Someone has to pay for management fees (the cost of collecting dues and paying bills if a mgmt company is hired)
4. Someone has to pay for lighting the entrances to the subdivision and irrigating any landscaping.

The cost of those things should be distributed equally among all the members of the HOA.