💬 Join us to post & get advice from 50,000 HOA & Condo leaders.

Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in

JoshS5 (California)
Posts: 1
Posted:
We moved into out townhouse community about 2 years ago and since then our HOA fees have jumped nearly $100! We pay $310 per month and do not get water, garbage and do not have a pool. The annual budget came out and nearly $13,000 will go toward administration and accounting, which is nearly 20% of our budget (with only 24 homes in the communtity). I can't help but think we are getting ripped off here.

The management company has not corrected problems (like parking violations) other than to send notices which then fines the association at the rate of $90 per hour to make up the notice. So even basic management issues are not included in this fee.

So for those of you who know...what is the "going rate" for management and accounting of a townhouse community? And what can we do to get them to lower their fees?

GlenL (Ohio)
Posts: 5,491
Posted:
Josh in reality there is probably nothing you can do to make the MC lower their fees. You could try looking around for a cheaper MC but I wouldn't hold my breath. Or you could try self management that would save you some money (maybe) but it would require dedication and perseverance on the part of the homeowners. If you do not have a sizable group willing to commit to SM then I would forget it. If you only have a few people willing to take it on then when they burn out and they will; you'll be right back where you started.

Studies show that 5 out of 4 people have problems with fractions
JohnK3 (Pennsylvania)
Posts: 967
Posted:
Josh,

You might want to consider self-management. Our HOA chose that for the same reason you mention. Try the search function - self-managed or self-management - for previous discussions.
JohnK3 (Pennsylvania)
Posts: 967
Posted:
Josh, additionaly, I recently posted on a different thread:

We have 21 SFDs. Median interiors are 3,850 sq. ft. Values have taken a hit in the past year, but even as we haven't had any sales since Summer 2007, talk on the street is that values are holding much better than in many areas in the country. We went self-managed when the previous/only PM (since 2001) wanted to increase dues to give them 1/3 of the annual gross (raising from the 2007 per unit quarterly $226 to close to $300). Our 3 member BOD is very active and does most everything including tasks we didn't sign on for, like removing and reinstalling our big pond's fountain to save us $1,400 a year. Membership is generally, make that essentially, apathetic, but very happy with our stewardship as in 2009 we have lowered dues while increasing services (mostly all landscaping related) via BOD work and especially shopping vendor bids which our PM didn't. We have no foreclosures, everybody (so far) keeps current with dues, and have no ByLaw or CCR violations.

The switch took a lot of initial work, but now that we've got our system running, it's a simple matter of collecting dues and paying bills. We bombard Membership with info via our emailed Updates that include all (though few now) BOD decisions and detailed, running financial reports.

At the end of the day, this success is about 3 guys who were willing to invest the time. We all had some personal, disparate reasons for joining forces, but they all came down to us believing we could deliver a better bang for our own bucks, and those of our neighbors.
EllenS1 (Florida)
Posts: 1,148
Posted:
Josh,

First I would check your docs to see what the increase can be in your assessments. Ours say 5% per year unless more is needed for lawncare (which is our main expenditure). Next I would insist on receiving a copy of the contract the management company has with your association and go through it with a fine tooth comb. You will then see what the company is to do to do for the association. If they are not doing what they were contracted for they are in breach of their contract and you can get another company to replace them. $90 per hour to send a letter is ridiculous and yes, in my opinion, you are getting ripped off.
EllenS1 (Florida)
Posts: 1,148
Posted:
Glen,

I am not a big fan of self management even for a small association but I am a big fan of reviewing the contract with the management company to see if they are charging and performing as stated in their contract.
EllenS1 (Florida)
Posts: 1,148
Posted:
JohnK,

Kudos to you. If only there were more homeowners committed to being as active as your group.
MikeS1
Posts: 521
Posted:
Townhouse ownership is ??Fee simple? Condo?

I would say that there's no such thing as a going rate for HOA management and it's very difficult to compare HOA fees and management costs between different HOAs due to their size and also due to their various amenities. We have about 400 homes (th's and sf's) and the management contract runs a little over $3K per month.

$90 per hour to make up the violation notices??? Oh my? If these are condos, then find a tow company to monitor the parking problem, sign an agreement with the tow company and just let them document, take digital picture and tow the violators.

It's touch to self-manage, but perhaps you could get someone to manage the accounting and then manage the rest of the stuff yourselves. It's a lot of work, the laws are always changing and it's hard to keep up with everthing.
PatrickH (California)
Posts: 204
Posted:
Hi Josh,

A 50% dues increase over two years is quite a lot. Do you know if your association was recently turned over from the original developer to the owners? What often happens is that the developer keeps the dues low to sell enough units until the association can be handed over to the members. Then once all the bills, especially the insurance, become the membership's responsibility, the dues have to jump to pay for them.

The cost of management is another issue. Based on your dues and the annual budget, it looks like there are only about 18 units in your development. A management fee of over $ 1,000 per month seems quite high for a small association, especially if they are getting an additional 90 per hour to write violation letters!

You can and should contact other management companies and ask them for a bid to take over your management. If they all come in around 1,000 per month, then you know what the going rate is, if they all come in around 600-700 per month, then you can look at your contract with the current company to find out how you can end their contract and go with some else.

Good Luck.

🎯 You've read this entire discussion

Join the conversation with 50,000 HOA & Condo Leaders:

  • ✓ Ask follow-up questions
  • ✓ Share your experience
  • ✓ Get expert advice
  • ✓ Access 350,000 discussions
Create Free Account →

⚡ Takes 30 seconds

Already a member? Log in here