Living with Restrictions

 

Most of us know that buying a home is a big decision with a lot of variables. Finances, geography, family, friends, lifestyle, work, the list goes on and on. We are all unique, so the perfect home means something different to everyone. One option that you don’t want to overlook, especially if you’re looking towards Retirement is a low-maintenance Property or Condominium. And with these choices. . . you have to learn to Live with Restrictions.

Homeowners association (HOA) and Condo Associations are becoming more prevalent throughout the United States. Millions of Americans live within these types of communities. Homeowners association rules can be what attracts someone to a new home, or what drives them away.  But, if you're on the fence about whether you want to live in an area with an HOA and abide by the rules, it's worth investigating the particular neighborhood and finding out more.

What is an HOA?
A homeowners association is an organization that oversees a group of homes by setting and enforcing rules, as well as maintaining the grounds. HOAs are most common in planned communities and multi-unit dwellings. Those who purchase a home in an HOA community must pay certain fees and dues to live in the community. Oftentimes, potential homeowners must also meet with the HOA to review community rules before renting or buying in the neighborhood. HOA fees can range anywhere from $20 to upwards of $1,000 or more. For some buyers, the idea that a management association can tell you when you can put out a decorative flag or that you can't park your truck in front of your property is a deal-breaker. Also, if you want to run a home based business, an HOA may not be for you. This doesn't mean you can't buy at all within an HOA, but you'll have to find one with regulations that meet your requirements.

In a subdivision with individual homes, regulations may include what color you can paint your home (and front door), how tall your grass can grow, whether you can plant or remove trees, which types of vehicles you can park on the street or in your driveway (no RVs, for example), how high fences can be and which types of coverings you can use on street-facing windows. If you want to do anything that deviates from the rules, such as paint your house chocolate brown instead of mocha brown, you will have to convince the HOA to grant you a variance, which is probably unlikely. When you buy a home in a managed community, you are actually buying a bundle of legal obligations and rights in addition to physical living space, says John Manning, managing broker at RE/MAX in Seattle. “The associated HOA dues reflect the management style of the homeowners association. For example, some associations prefer a large cash reserve on hand to meet maintenance, legal or management obligations that arise. Others have lower fees and rely on special assessments.”  My Mom lives in a 55 and over community in a comfortable 2 bed/2 bath home with an HOA payment of $70 per month. She is happy to have a yard with fruit trees and does not have to mow the lawn. But, she is responsible for the exterior & interior maintenance of the home and that can be overwhelming for older citizens. Heaven forbid if she should need a new roof??  Her savings account would be depleted and she would be one unhappy resident for years!

What is Condo Management?
A Condominium (condo) is a privately owned residence in a building or community with multiple units. A key feature of a condo are the shared common areas and amenities such as lawns, pools, tennis courts, etc. Essentially, it's a little bit yours and a little bit everyone’s. While things like the pool and tennis courts are almost always shared, the space inside your specific unit is yours & yours alone. The nuances can vary greatly – especially between condos and townhouses – but the common theme is there are some things you share and some things you don't in terms of both use and responsibility. Looks Pretty sweet, right? A pool you don't have to clean, manicured lawns that you don't have to mow, etc. Well, as you may have guessed, these perks aren't free.

Condo owners pay dues to a board or homeowners association to cover the costs of these amenities as well as maintaining the shared areas of the property. This part is particularly appealing if you’re looking to own a home, but don’t want to be responsible for maintenance and yard upkeep. No more figuring why your drain is backed up or why the AC isn't working . . . . just pick up the phone and help is on the way!  Well. . . Not so Fast!  I live in a Townhouse Condo community of 88 units with a monthly maintenance of $496 that includes, water, cable & Insurance as well as amenities. I'm very happy until a special assessment shows up in my mailbox.  Assessments are common and very pricey in a condo community. The condo development’s homeowners association will charge this fee if the development needs extra money to take on a major repair, such as replacing an aging roof or repairing a damaged swimming pool. Associations are supposed to build a reserve fund for emergency repairs, but some repairs are so major that the reserve fund can’t cover them. When your homeowners association charges a special assessment, you’ll have to pay additional money each month to pay your share of the development’s repair work. A well-run and organized association can make for a highly enjoyable community, while a poorly governed association can lead to its share of problems.

Considering a condo versus a single-family home takes understanding a lot of variables and nuances, some of which are listed here. It is true that many condos are more affordable than houses. In addition, insurance rates are lower for condos due to the fact that you’re only responsible for insuring your specific unit and not the common spaces. These factors mean condos are often the more budget-friendly choice. Generally speaking though, a condo complex can be wonderful for young first-time home buyers or Retirees, but it’s not ideal for people craving more privacy and autonomy.  It is not a one space fits all Lifestyle.  Ultimately, it comes down to your list of must-haves and deal breakers when searching for a home. Do your own research, take pen to paper and make good notes.  If you choose an HOA planned community or a Condo, it must make Financial sense! This is super important in your ability to enjoy Living with Restrictions.

** Thanks for Visiting. This post is ForYourEdutainment (FYE).  I am not a Financial Counselor nor an Accountant - Just a woman on this life journey.  If you like this post, please comment & Email it to your friends. Don’t forget to follow me on Bloglovin  for new post updates, and on Pinterest. **