HOA: What to Check Before You Buy in a Managed Community
An HOA (homeowners association) can maintain property values and provide amenities — or it can burden you with fees, fines, and restrictions you did not expect. Review the documents before you buy, not after.
Financial Health
Request the HOA's financial statements and reserve study. A healthy HOA has reserves equal to at least 25-30% of its annual budget. Low reserves mean special assessments are likely — surprise bills that can run thousands of dollars. Check for any pending or recent special assessments. Also check whether any lawsuits are pending against the HOA.
Rules and Restrictions
Read the CC&Rs (Covenants, Conditions, and Restrictions). Can you rent out your home? Are there pet restrictions? Can you park a truck or RV? What about exterior modifications, paint colors, or landscaping? Some HOAs are lenient; others regulate everything. Make sure you can live with the rules before you are legally bound by them.
Meeting Minutes
Request the last 12 months of board meeting minutes. These reveal ongoing disputes, planned projects, budget concerns, and the general culture of the community. Contentious meeting minutes are a red flag. A well-run HOA will provide these documents without hesitation.
Key Takeaways
- ✓Check the HOA's reserves — low reserves mean special assessments are coming
- ✓Read the CC&Rs to understand what you can and cannot do with your property
- ✓Review 12 months of meeting minutes for red flags
- ✓Ask about pending lawsuits and recent special assessments before committing
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