It's Boiling Over...HOA Issues Are On The Rise

The bite is severe and it’s going to get worse. HOA issues are on the rise, but the vitriol directed at them is not always justified. Homeowner associations exist to maintain property and community standards; to ensure that owners, their properties, and community property, meet agreed upon standards. Over the last several years, many HOAs have been financially stressed and that stress is being passed to residents. The catalyst was the Surfside Condo collapse, the mismanagement there was a clarion call to many. 

Increasing HOA Fees

HOA fees in Greater Atlanta increased by 12.2% from 2022 to 2024; that was about the median across the country. Two main reasons are behind ever increasing monthly fees; inflation and maintaining adequate reserves. The cost of insurance has exploded over the last few years. The pandemic saw supply and labor shortages; prices rose and did not come back. Routine maintenance costs continue to increase, if work is needed beyond what the budget allows…it’s addressed with a “special assessment”.

A one-time fee – a special assessment – is proposed and levied as/if needed for an association to complete unscheduled repairs. How an association does it is up to them, typically there is a meeting called, and the issue discussed. They may be paid at once or in installments, it’s a case by case situation.

Properties subject to a homeowner’s association are required to have a “community association disclosure” exhibit. This document is to be completed by the seller, including disclosing any contemplated or approved special assessments. Special assessments can be devastating for owners, consider what’s going on in FL and this community in GA…

Each Homeowner Received a $29K "Special Assessment" to Repair the Dams.... 

What Buyers Need

Not everyone should live in an HOA community; there are rules and required fees. GA is a buyer beware state, it is the buyer’s responsibility to check the covenants, budget, and everything else. The time to do this is during due diligence, complaining after the fact is absurd. Buyers, especially in attached homes, should also understand that these fees will have a direct impact on their mortgage, they are considered a debt.

Fees are always subject to change, usually increases. Special assessments are always possible, consider the impact these are having in the Florida market. Long time owners, many without mortgages, are struggling to pay exceptionally high special assessments. These are having a direct impact on value and marketability. Attached homes especially, are dependent upon each other; all need to be involved or the community – and each owner – suffers.

Understand the process and nuances of buying any home. This is an especially critical aspect, the ramifications of improper research can result in crazy stress and financial calamity. This is yet another area where an experienced agent is an invaluable asset.

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