Does an HOA Need a Management Company?

HOAs deal with a lot of responsibilities and important decisions that can be a challenge without proper guidance. And when it comes to the management of an HOA, having a reliable and reputable management company can be extremely beneficial. 

But do you really need a management company for your HOA?

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An HOA management company is a team of experts responsible for the day-to-day running of a homeowners association. From responding to inquiries from members, enforcing rules and regulations, collecting dues, managing maintenance projects, organizing social events, and more — their role is vital in ensuring that an HOA runs smoothly.

 

 

While some HOAs will rely on their board or a volunteer to handle the day-to-day operations, having a professional management company can be very advantageous. Professional HOA management companies have staff with specialized expertise and resources, like HOA websites, that are beneficial to homeowners associations. They also provide continuity of service and can ensure that rules, regulations, and policies are being enforced properly.

Let’s take a closer look at HOA management companies – what they do, why they matter, and how they help HOAs succeed.

What Is An HOA Management Company?

An HOA management company is a professional property management company that specializes in overseeing homeowner associations and master-planned communities. They provide comprehensive management services to handle the day-to-day operations and administration that keep an HOA running smoothly.

HOA management companies have extensive experience working with homeowner associations and governing boards to enforce covenants and bylaws, maintain common areas, handle finances, and ensure residents’ needs are met. They serve as an intermediary between residents and the elected HOA board.

The scope of responsibilities an HOA management company can handle includes:

  • Collecting monthly HOA dues and special assessments
  • Managing accounts payable and receivable
  • Developing annual budgets and tracking reserves
  • Overseeing maintenance of amenities and common areas
  • Verifying compliance with architectural guidelines
  • Issuing violations and levying fines when rules are broken
  • Supporting the HOA Board of Directors with meetings and records
  • Communicating regularly with homeowners
  • Even assisting with HOA legal matters if needed

 

Professional HOA community managers must pass state licensing exams in some areas to demonstrate their expertise across the many facets of association management.

Outsourcing to a qualified HOA management company allows volunteer HOA boards to offload administrative work and ensure operational continuity when board members change. Their comprehensive services support any HOA seeking to protect property values and meet high homeowner expectations.

How is an HOA Management Company Different From an HOA Board?

How is an HOA Management Company Different From an HOA Board?

While an HOA management company and HOA board work hand-in-hand to oversee an association, they play very different roles with unique responsibilities. Understanding the distinctions between the two is important for any community evaluating professional management.

It’s easy to think of an HOA board as being a “defacto” management company. After all, they both manage an association by setting and enforcing rules and regulations and maintaining common areas. However, there are some distinct differences that set them apart.

HOA Board

The HOA board of directors is an elected group of homeowners who establish policies, rules, and strategies for the community. Often led by a president and supported by an HOA manager, the board is tasked with representing all homeowners in the association, managing budgets, mediating disputes between owners or tenants, and ensuring that day-to-day operations are running smoothly.

Their key responsibilities include:

  • Governing the community in accordance with established covenants/bylaws
  • Making major decisions about projects, amenities, maintenance, and improvements
  • Developing an annual budget and setting monthly dues amounts
  • Establishing, interpreting, and enforcing community rules and architectural guidelines
  • Attending and arranging board meetings, annual meetings, elections, etc.

The board acts as the face of the community leadership and maintains a pulse on homeowner satisfaction. They may have the final say on approving contracts, resolutions, and appointments the management company recommends.

HOA Management Company

HOA Management Company

A professional HOA management company handles the day-to-day operations and administrative management of the association. These third-party companies have the expertise and resources to help the board navigate complex legal regulations while also providing helpful guidance on business matters.

  • Collecting monthly assessments and paying community expenses
  • Working with contractors to facilitate maintenance and repairs
  • Fielding and resolving homeowner questions, issues, and complaints
  • Ensuring compliance with established rules using warnings and fines
  • Staffing the community office and responding to emails/calls
  • Advising and supporting the HOA board behind the scenes

The management company essentially executes the broader vision and policies set by the board. They manage continuity in HOA operations that persists through board turnover – and ultimately help to ensure the success and prosperity of the HOA. Their expertise and resources make them an invaluable partner in maintaining a thriving community.

Choosing the Right HOA Management Company

Choosing the Right HOA Management Company

Selecting a professional HOA management company to partner with is one of the most important decisions an association can make. The right management team is invaluable in handling homeowner needs and ensuring community success.

However, choosing the best HOA management company for your community isn’t an easy task. Here are some key tips for selecting a provider with the right expertise and experience to meet your needs:

Step 1: Define Your HOA’s Needs

Thoroughly evaluating your HOA’s needs and priorities is the critical first step toward choosing the right management company. You want to match the provider’s service offerings and strengths to the must-have support your community requires.

Carefully consider and document:

Size of Community

  • Total number of homes/units in the association
  • Approximate number of residents
  • Average home value range
  • Any planned expansion if still developing

This helps match you with a management company that has experience with communities of your scale. They should have adequate staffing and infrastructure to meet service demands.

Amenities to Maintain

  • Clubhouse, pools, tennis courts, dog parks and other recreational facilities
  • Gated entries and perimeter fencing
  • Ponds, lakes, or water features
  • Playgrounds, parks, fields, common green spaces
  • Roads, sidewalks, signage, lighting, landscaping

The more physical common assets your HOA must manage, the more maintenance coordination support you’ll need from a management provider.

 

 

Service Priorities and Pain Points

  • Are assessment collections a struggle? Seek strong financial management.
  • Is overgrown landscaping drawing complaints? Find support to bolster grounds care.
  • Do you need help enforcing parking restrictions? Ensure rules enforcement is available.

Document the specific areas that need the most oversight where a partner could provide relief and improve homeowner satisfaction. State these priority needs upfront when interviewing.

Scope of Management Support Required

Clearly establish which facets of management you want to outsource, such as:

  • Finance and budgeting
  • Accounting and bank reconciliations
  • Payment processing
  • Insurance administration
  • Contractor selection and management
  • Maintenance coordination
  • Inspections for CC&R violations
  • Architectural design guideline enforcement

Some HOAs hire a manager for a narrow subset of tasks, while others want full-service community management. Defining your requirements will inform provider selection.

Special Projects in the Works

Make note of any unique initiatives already in motion or on the horizon that will require management assistance, like:

  • New amenity construction
  • Major landscape renovations
  • Reserve study completion and funding strategy initialization
  • Board election process updates
  • Technology implementation projects
  • Policy changes or bylaw amendments

Availing managers of significant plans ahead of time ensures they marshal the proper resources and expertise.

 

 

Step 2: Vet Industry Experience

Once you have a clear picture of your HOA’s service requirements, vet the experience of prospective management companies thoroughly. Confirm they have proven expertise, specifically within community association management.

Ask targeted questions like:

How Many Years Has Your HOA Management Company Been In Business?

  • How long have you been serving HOAs under your current brand?
  • Were you established here locally or part of a national company merger?
  • Do you specialize only in community management or serve other property types?

Many fledgling start-ups give HOA management a try but fail to scale adequately. Verify a well-established track record – because you don’t want to be the test pilot!

What Is Your Portfolio of Communities Served?

  • How many homeowner associations are you currently managing?
  • What size ranges are included in your management portfolio?
  • Could we get a sample list of current client communities you manage?

Cross-check that they have extensive experience serving HOAs in your state and of comparable size. Preferably they also offer references from similar communities.

What Industry Training and Designations Do You Hold?

  • What percentage of your HOA managers hold advanced certifications like CMCA, AMS, PCAM, etc.?
  • Do you incentivize or sponsor your staff to pursue such professional development?
  • Are staff required to complete a new manager onboarding training program?

It’s a good sign if the company invests substantially in formal training for its personnel. Well-credentialed managers ensure knowledge of best practices.

By evaluating the scope of an HOA management company’s hands-on experience managing communities over many years, you gain the confidence they can capably handle your association’s needs.

Step 3: Interview Multiple Providers

Once you have screened for extensively experienced candidates on paper, take the process to the next level by sitting down for in-person interviews before selecting your HOA’s management company.

You’ll want to include an assessment of the company’s core values and brand voice. Do their beliefs align with those of your HOA? Are they focused on quality, efficiency, customer service, or something else? This is a key step in ensuring a successful partnership between your association and its management company.

The interview should also cover topics such as services offered, fee structure, reporting timeline, and standards of communication between both parties. What tools does the firm use to facilitate communication with board members, residents, and vendors? How do they handle enforcement policies? 

All these matters are important when selecting a management provider that best suits your community.

 

 

Step 4: Take The Potential HOA Management Options to Your Community and Board

Once you have narrowed down your choices to a handful of potential candidates, it is time to take these options to your community and board for approval. 

Make sure all the important information is included in this discussion. This may include costs associated with each provider, their approach to communication, how they handle emergency situations, and more.

The input from both the board and community members will help determine which HOA management firm best fits the needs of your specific association. After careful consideration, select a firm that best reflects the culture and values of your neighborhood.

Frequently Asked Questions

Frequently Asked Questions

What does HOA management company do?

An HOA management company handles all the administrative and operational responsibilities involved in running a homeowners association community. This includes services like collecting assessments, paying vendors, coordinating maintenance, enforcing rules, staffing an on-site office, supporting the board, and fielding homeowner questions or complaints. They execute on the broader vision and governance established by the HOA board.

How much does a HOA management company charge?

Pricing varies, but HOA management companies typically charge monthly fees in the range of $6 to $10 per home. This may range higher if there are more amenities involved or if the community requires more maintenance support. Additional charges for special projects may also apply. Companies provide detailed quotes based on an HOA’s size, location, and exact management needs.

What is HOA management company?

An HOA management company is a professional property management firm specializing in the comprehensive administration of homeowner associations, condo associations, townhome communities, and other jointly-owned residential developments. They have staff experienced in all aspects of daily HOA operations management.

Who runs the hoa?

While a professional HOA management company may coordinate much of the day-to-day execution for an association, governance lies with an elected homeowner board of directors. This volunteer HOA board centrally runs the association by establishing budgets, policies, projects, rules, and a strategic vision for the community.

The Bottom Line

Deciding whether or not to hire a professional HOA management company is an impactful choice for any homeowners association. While some smaller communities succeed by relying on volunteer efforts, most mid-size and larger HOAs choose to outsource day-to-day administration and operation.

A management partnership’s expertise, efficiencies, and oversight continuity offer immense value. Their staff and systems make it possible to collect assessments, handle inquiries, enforce rules, oversee contractors, and support an elected HOA board consistently, even amid resident turnover.

 

 

However, entrusting much of your community’s care to an outside company requires proper vetting and due diligence upfront. Clearly determining your HOA’s management needs and priorities will allow you to select a provider that offers the best fit along dimensions like experience, services, credentials, and technology capacity.

Take time to consider the core capabilities you need from a management provider, and decide on an ideal balance of cost and value. By thoroughly researching options before signing with a partner, you can ensure your community’s HOA management needs are met best.

Get started today

HOA Start software and our community website support provide all the tools you need to operate your association efficiently and effectively. Are you ready to take the next step? Join the network of HOA Start customers and share the success with your community. Call 863-462-7483 to speak with a team member, or click here to send us an e-mail message today.

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