Running a thriving community often depends on effective HOA management to keep things running smoothly. Good management helps protect property values, ensures financial stability, and creates a better living experience for everyone. But what actually goes into managing an association?
What is HOA Management?
Homeowners association management is the act of overseeing the operations, maintenance, and administration of a community. Another term for this is community association management.
Homeowners associations are organizations that consist of homeowners, often in a planned development, condo, or neighborhood. These organizations can’t function without proper management, which involves a wide range of duties and responsibilities. HOA management ensures that the association’s operations run without a hitch.
HOA Management vs HOA Property Management
Although some people use these terms interchangeably, there is a big difference between HOA management and HOA property management.
HOA management refers to the management of a community or neighborhood. It involves tasks such as common area maintenance, vendor coordination, reserve planning, dues collection, and rule enforcement. Professional HOA management clients include homeowners associations, condo communities, townhome associations, and the like.
In contrast, property management refers to the management of rental properties. It involves tasks such as rent collection, tenant screening, listing properties, property maintenance, and eviction (in some cases). Professional property management clients include landlords and rental property owners.
Of course, some HOAs require both services. Some associations own rental properties within the community. That said, when associations need professional management services, they are usually referring to HOA management.
Who is Responsible for Managing an HOA?
In an HOA community, the primary body responsible for management is the HOA board of directors. The HOA board consists of volunteer members of the association who are elected by their fellow homeowners.
There are generally two types of associations in terms of management: self-managed communities and professionally managed communities.
Self-managed HOAs rely solely on the board of directors to run the show. Board members are responsible for enforcing the rules, collecting dues, managing finances, communicating with residents, hiring vendors, ensuring common area maintenance, obtaining insurance, and more.
Meanwhile, professionally managed associations rely on an HOA management company. This company takes care of the community’s homeowners association management needs, including the duties that the board would normally be responsible for.
Some companies offer à la carte services, which don’t include the full suite of services. For example, an HOA might only require financial services or remote management. Associations should first evaluate their needs before hiring a professional.
What Does an HOA Management Company Do?
Management companies cater to homeowners associations and condo communities. They assume a large chunk of the board’s responsibilities, but they don’t receive any decision-making authority. Essentially, the company exists to alleviate the board’s burden and serve the community.
While exact HOA management services will depend on the agreement between the company and the association, they typically include the following:
1. Accounting and Financial Management
A management company can take over the financial aspects of managing an association. This includes help with budget preparation and reserve planning, as well as insurance. The company can also assist with dues collection, invoicing, bill payments, delinquency tracking, and financial reporting.
2. Rule Enforcement
Enforcing the rules is one of the board’s duties, but a management company can also assist with this. The company can conduct routine inspections, investigate complaints, field reports, and ensure compliance. If there is a violation, the company can oversee the whole violation process, from sending notice to scheduling a hearing to imposing the penalty.
3. Maintenance
An HOA management company can oversee maintenance and upkeep. This involves scheduling inspections, assigning tasks to contractors, and reviewing work orders to ensure timely completion. Many companies also offer emergency maintenance response.
4. Vendor Management
No HOA can work entirely alone. Communities often rely on vendors to provide essential services, including maintenance and repairs. The HOA management company can handle vendor management and coordination. It can also assist the board with the vendor selection process by soliciting bids, interviewing candidates, and making recommendations.
5. Homeowner Communication
Communicating with homeowners requires considerable effort. The HOA management company can also take over this aspect of the job. From sending notices and posting on bulletin boards to sending newsletters and addressing concerns, the company can do it all.
7. Legal Assistance
An HOA management company can offer legal assistance to the association. This includes help with interpreting and amending governing documents, reviewing contracts, and providing legal updates. A company can also ensure compliance with federal and state laws, such as the Virginia Property Owners Association Act.
8. Board Education
Management companies typically offer board training and access to resources. They can also assist with administrative tasks, such as preparing for board meetings and maintaining records.
When to Hire an HOA Management Company
If self-management is a viable option, why would any community need to hire professional management? There are several reasons why HOA management companies remain in high demand.
For one thing, many HOA communities struggle with managing a large population. There are associations with hundreds (or even thousands) of residents. Communication alone would be a considerable burden. An HOA management company can help with this workload and stay on top of maintenance, dues collection, and rule enforcement.
Another reason to hire an HOA management company is if the community has extensive or complex amenities. Some communities have several amenities or ones that require extra attention. These are the communities that typically require professional assistance, particularly in areas such as maintenance and upkeep, reservations and rentals, and scheduled upgrades.
Ultimately, many boards lack the time and expertise to manage the intricacies of HOA management effectively. After all, board members are just volunteer homeowners. They are not necessarily equipped for the job.
The Bottom Line
Community management is often in the hands of board members, but many communities seek professional help. Regardless of the circumstances, it is essential to comprehend the responsibilities of HOA management.
National Realty Partners is a leading provider of HOA management services in Virginia. We help communities thrive. Call us today at 703-435-3800 or request a proposal online to get started!
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