HOA Dues Increase 9.5%

We are telling our homeowners of the 9.5% in dues. Email blast below. We will see how much negative reaction we get, hopefully some understanding too! Will report back in a couple of weeks. Sue

Dear Homeowners:

We are sending this email following X's Board Meeting on September 9, 2025. The Board voted to increase the monthly dues to $415, effective January 1, 2026, a 9.5% increase over the current monthly dues.

The figure of $415 per month per unit was a difficult decision, primarily driven by the HOA's need to boost Reserves over the next 7 years to fund the replacement of the roof underlayment in 2033. The current cost for this underlayment project is estimated at $2.5 million, and our Reserves are currently at $1.2 million.

The Board believes this to be the soundest decision for the financial long-term health of our HOA, and for the value of our homes.

Regards,

The Board of X HOA

I agree that this email is very well written and informative. Yes, expect complaints but the HOA decision is logical and appropriate.

"Soundest decision." As a member, I would like to see the notice of increase included with the annual budget report so members can see the reserve study summary and better understand the reason for the increase,

I suggest holding a special meeting anyway to discuss this because the open forum won't be enough time and you still have official association business to address. Your regular meeting is on Veterans Day, so you may want to do something between now and Nov. 21 because the following week will be Thanksgiving week.

In the meantime, provide more information about income and expenses on your community website. What's gone up the most during the last 3-5 years and why? Have delinquencies become more prevalent? Did the association follow the previous reserve study recommendations - if not, why not? What's happening with the master insurance coverage - it's increased everywhere else; what has your carrier told you?

Find someone who's really good at preparing graphs - they're great at showing people what's happened and it's easier on the eye than wading through bunches of columns on a spreadsheet. Those can be posted on your website and you can use them again as a power point presentation for the special meeting

And, you still need to discuss what you've done to control costs and what type of decisions the community may need to make going forward. For example, some communities reduced amenities (we' closed our swimming pool years ago).

Dean,
You are 100% correct. I just still wonder why it took so long to make the dues increase. They obviously needed to increase more but did the 9.5% increase to keep it under the need for a vote of the owners.

I think this is perfect. Doing more is enabling laziness by owners. In general: Give a person the chance to complain, and they will seize on it at length. And in general, they will not lift a finger to help.

My former condo association has had a few increases in the last several years, one north of 25%. No special meetings were called to discuss these. A few sentences about expenses going up as reflected in the annual budget, along with the reserve study summary, more than suffice. Elections in the last few years have been competitive.

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I will be more than happy to provide my analysis, can you confirm this is a 95 unit HOA?

In my experience, most large assessment increases are not caused by lazy wasteful boards. They are caused by owners with unrealistic expectations. Number 1 being there is magically waste that can always be cut from a budget. The net result is boards underfunding the reserves.

Susan,

You say the previous board thought 60% was an adequate reserve. The problem is you currently have 48% of the liability in reserves. So I suspect your current reserve funding is minimal. Your HOA is further challenged because taxes are due on the interest earned by the reserves and the interest rates are falling.

I don’t know what special assessment value you believe your owners can swing in 7 years, but it certainly would be unfair to an owner purchasing in within 15 months and got hit with a $4,000 special assessment and the previous owner walking off $4,000 to the better.

I suggest your board adopt a plan of assessment increases that will have the liability closed in 7 years.