Homeowner Associations (HOA's) in the Triangle AreaHere is what buyers need to know about homeowner’s associations (HOAs). HOAs are common throughout North Carolina and are nearly universal in the Triangle area. The role of a HOA is simple: to protect and preserve property values throughout the neighborhood. You may have heard “horror stories” of people who had bad experiences dealing with their HOA—but throughout my career in real estate, I’ve found these cases to be rare. In fact, homeowners often take for granted how much HOAs help them. Condominiums have associations as well, and while their function tends to be more hands-on, their role is basically the same (see my article on the difference between a townhome and a condo).

The Neighborhood’s Influence on Home Values

You may have heard the old saying about real estate. There are three factors that go into deciding on a house: “location, location, location.” As I often tell my clients, the only thing you can’t change about a house after you move in is the neighborhood around it. There’s nothing wrong with buying a fixer-upper at the right price; you can transform an ugly house inside and out. However, the neighborhood carries more weight with buyers when it comes to deciding what properties to look at.

Curb Appeal

The HOA plays an important role with regard to protecting the value of a neighborhood. They are responsible for upkeep of common areas (such as swimming pools, tennis courts and playgrounds) and maintaining overall aesthetic appeal. When a buyer drives through a neighborhood to look at different properties, they will have formed a first impression before they even see your house. If your neighbors’ properties look unappealing or poorly maintained, a buyer will get a bad impression and you won’t be able to do anything about it. The HOA is in place to prevent situations like this before they happen.

Restrictive Covenants

Every HOA has a set of agreements in place, to which you are legally bound when you move into a neighborhood. These Covenants restrict what a homeowner can do with the exterior of a property. Some neighborhoods are more restrictive than others, but most Restrictive Covenants amount to basic common sense. These frequently include things such as landscaping, paint colors, window coverings, fences, trashcans, satellite dishes, and limiting the number of rental properties. The intention is to maintain property values by enforcing a certain standard of appearance and use.

Authority and Governance

HOAs function as mini-governments of sorts. Their authority is narrow in scope, but they have power to enforce their decisions. HOAs have the authority to collect dues and to use these funds for community improvements (for example, installing speed bumps on common roadways inside a subdivision). If a property owner fails to comply with requirements (for example, by leaving trash or broken appliances lying around), the HOA can levy fines. If dues or fines go unpaid, your HOA can place a lien on your property and can eventually foreclose. Homeowners in the development comprise 100% of the HOA Board. As a homeowner, you have the right to vote on decisions that affect the neighborhood as a whole.

You can think of the HOA in any development as an “insurance policy” that safeguards future home values by ensuring consistency in the look and curb appeal of the neighborhood. If you do not wish to live within an association, simply let us know your preference and we can filter your property search accordingly.

Posted by Larry Tollen on
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