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Why Your HOA Needs a Management Company

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Buying a home in a homeowners association can be confusing, intimidating and downright dizzying for people who are unfamiliar with how HOAs operate. This blog aims to explain why your HOA needs a management company and what management companies do.

We should begin this blog by saying that no one should buy a home without reading all of the paperwork and any ‘fine print.’ This is particularly pertinent when purchasing a home in a homeowners association because there are covenants, rules and regulations that would not be found when purchasing a private, single-family detached home. That said, some people purchase homes in HOAs without fully knowing what that might entail. There can be a variety of surprises for such owners. One of the more common surprises is that there is often a managing body that enforces restrictions on behalf of the HOA.

The management company is not “the HOA,” contrary to the belief of many folks who declined to read their documents prior to purchasing. Management companies do, however, meet with the board of directors and implement the board’s decisions on how to best run the association. Management companies issue notices of violations (and sometimes accompanying fines) as related to enforcement of the covenants, rules and regulations, process the payment of homeowner assessments and other payments, provide other accounting services, facilitate the use of vendors (landscapers, roofers, painters, etc.), and more. Some HOA management companies, such as CAP Management, go beyond what is expected and offer specialty services.

Some homeowners have asked why their HOA needs a management company when they have taken the time to elect a board of directors to lead the community. First and foremost, their HOA is likely required to have a board per applicable laws. Consider that in Colorado (at least) that homeowners associations are non-profit corporations. The need for a board of directors is usually laid out in the association bylaws, declarations or both. It is important to understand that members of the board are volunteers. While they have the time to meet once a month to make guiding decisions and likely to send emails occasionally throughout the day, board members are unlikely to have the time to manage every aspect of every function of their HOA. Even if they did have full-time availability, chances are they would not commit the time it takes due to other factors in their lives. This is why boards hire management companies to do the work for them. Agents of management companies do have full time availability to manage community associations because that is their job. Simply stated, management companies do so well because they have a vital, irreplaceable purpose.

Some HOAs are very small with just four or five units. Do they need a management company like 325-unit associations do? Yes and no. They likely will have a management company for accounting purposes only, at least. Some, however, are able to self-manage with some very dedicated homeowners. Kudos to them! No matter how you look at it, HOA management is not an easy job.

CAP Management loves HOAs and everything that entails. Reach out to us if you think we can help. HOA management is what we do!