Article about HOA's in Motley Fool

This article appeared in my newsfeed. The comments about the topic I found most interesting.

https://www.msn.com/en-us/money/realestate/we-passed-on-a-house-in-an-hoa-neighborhood-for-one-huge-reason/ar-AAZyUv9?ocid=msedgdhp&pc=U531&cvid=5cfaeca73466495787e44b60a368543e

If they community is catering to the wealthy and these people want golf courses, tennis courts gyms, restaurants, etc. then I see nothing wrong with this. I can't afford it but I don't know what the point of this article is.

I think this article is cursed!

These folks did exactly what any prospective homeowner should do - look at the rules and consider how the HOA assessments will fit into the budget BEFORE YOU BUY. At different times, the community may consider some rules are more critical than others and that may or may not cause a problem, and of course, folks on this board know how the money can get funny, depending on the cost of living, how well reserves are funded, delinquency rates, and all that. Some of us on this board could have avoided a lot of drama in our lives if we'd taken the time to do a little research before signing all those papers at closing (because it's too late by then).

And after all that, HOA living still isn't for everyone, and that's ok too. You have to pay a little more attention to what's going on in a HOA community - who's on the board, how long have they been there, and do they apply careful thought to the issues? Do the homeowners keep track on what the board is doing, understand the rules and behave like they realize homeownership of any kind isn't a spectator sport?

Well, don't feel too badly - if I'd taken a closer look at the delinquency rate in my community and truly understood the implications, I may have reconsidered. At the time, I figured the board was issuing late fees and taking people to court (which they were) and assumed as long as that continued we'd be fine. After I got on the board, I began hearing about some residents (one in particular) who played the system every which way to keep from paying. Those numbers add up and although it's a lot better than what it was, it's affected our reserves to the point that everyone has been told there will be fee increases from now to infinity and beyond. All we can hope for at this point is not to run into a situation where a loan or special assessments (or both) would be required.

It's like my uncle once said about buying a car - the first time, buy any car and make all your mistakes with that one (pay too much, get crappy terms on the auto loan, skimp on maintenance, and so on). That's how you'll learn what to do, or not.

I think people get so enthused about buying a house (especially first-time homebuyers), that we treat it more like buying groceries as opposed to making one of the biggest financial decisions we'll ever make. I was a first-time homebuyer and participated in a program in my city that works with folks like me - they review your credit report, explain what goes on at closing, what the real costs of ownership will be, etc. That was the smartest thing I ever did. Fortunately, I also had a good realtor (referred by a friend) who helped me get a home inspection, something I hadn't considered at all (thinking everyone takes good care of their homes, right? Hell naw!)

In my case, I was chatting with a co-worker (also a first-time homeowner), who told me about his inspection, and like him, I followed my inspector around for three hours as he looked through the townhome, explaining what was ok and what might have to be addressed, along with useful information like which valve operated the water source for the ENTIRE house! That's another area people forget about - they think they have three days after signing the contract to back out if something goes wrong (nope!)

So I'd add getting a home inspection - it's true the inspector may not find everything (because they don't usually tear apart the components), but paying $200 or $300 or so to an inspector might save you thousands of dollars down the road.