Return to 11 Steps to Home Ownership!
Step 10: Doing the Final Walk-Through and Closing
If you are thinking about buying a home in a new subdivision, common interest development (CID), or planned unit development (PUD), chances are good that you will automatically become a member of the local homeowners’ association. These associations help protect property values by ensuring each home is up to neighborhood standards, but make sure the rules and regulations are compatible with your lifestyle and pocketbook.
The primary purpose of an HOA is to provide maintenance, enhancements, and protection for the community’s common areas. An example might be tennis courts, a pool, a playground, or trails – all of which would be maintained by dues or special assessments that the residents of the community pay to the HOA. This pooling of money gives an individual homeowner access to facilities that they would likely not be able to afford on their own. An HOA’s dues can range from a minimal amount to many thousands of dollars per year, depending on the neighborhood and its standards and amenities. Keep in mind that even if you know you’re not going to use the pool, moving into the neighborhood obligates you to pay theses dues.
When you purchase a home in an area governed by a mandatory HOA, remember that you’re also entering a legal contract with that HOA. You agree that, in addition to paying dues, you are obligated to live by the association's rule book.
Make sure you know what you’re getting in to when you purchase a home that’s covered by an HOA. The benefits of the HOA may suit you, but be sure you are willing to play by the rules.