Homeowners associations (HOAs) are volunteer-run organizations that oversee the homes in distinct communities. HOA boards often don’t have the time to tackle community management work, such as collecting fees, performing maintenance, and so on. That’s where HOA management companies can help.
Billing and Collections Services
HOA management companies frequently handle billing and collection services for the boards that employ them.
Bill Residents for HOA Fees
All HOAs have fees associated with keeping meetings, maintaining grounds, and paying for property management companies. The management company is responsible for:
- Tallying how much money it is owed each month
- Collecting the money from the homeowners
- Making sure that homeowners understand how much money they owe
Note that this is not the same thing as rent collection, which is an important responsibility of standard property managers who oversee rental properties. HOA management companies only collect money for their services.
Track Down Late/Delinquent Payments
The HOA management company is responsible for contacting homeowners and securing late payments ASAP. They can do this in a variety of ways:
- Email the resident with the late or delinquent payment
- Then the company might send a written notice to the resident
- Lastly, the HOA management company may personally visit the resident to secure the payment
Issue Notices to Residents
HOA sometimes have problems with residents refusing to pay fees. If this occurs, the HOA management company will issue notices to residents and take care of any billing discrepancies.
By putting the power of billing and collection services in the hands of HOA management companies, HOA boards don’t have to worry about these elements, nor do they have to compromise the friendliness of their community. Delivering a late payment might feel a lot different to a delinquent resident if the collector is their neighbor rather than a third party management company.
Accounting Services
HOA management companies take care of most of the accounting work inherent in running a homeowners association.
Manage and Reconcile Accounts
Many HOA management companies are responsible for managing and reconciling accounts, which includes:
- Standard bookkeeping practices, like tracking incoming payments and expenses
- Making sure that recorded expenses match money exiting the accounts
- Accounting for all monetary transfers, especially when it comes to collections
To do this, an HOA management company might hire a dedicated accountant. But in many cases, an office receptionist or some other employee handles the majority or all of the bookkeeping work.
Prepare and Distribute Accounting Reports
HOA management companies handle the preparation and distribution of accounting reports. These reports are typically delivered to HOA board members, which include the community residents who handle the majority of HOA decisions and oversight work.
However, some HOA management companies may also give accounting reports to residents who request them. For example, if a resident wants to know how the HOA fees are being spent, they might request a record of that accounting information from the management company.
Offer Budget Advice
HOA management companies frequently offer budgetary advice to HOA board members, who may not have as much experience handling finances for large operations or organizations like homeowners associations.
For example, an HOA board meeting might discuss whether or not an extra $200 should be used to prepare party supplies for an upcoming holiday. The HOA management company can provide budgetary advice, such as whether the money should be put into the repair reserve account, whether the money should be used for something else, etc.
Monitor and Maintain Reserve Accounts
These reserve accounts are typically escrow accounts held in a local banking institution, to be used for a variety of purposes:
- Repair funds – The management company maintains a repair reserve fund so it can instantly pay for necessary repair services and supplies without having to consult with the board. Then the excess money from HOA fees goes back into the account to top it off to a predetermined minimum
- Inspection fees for the same purposes described above
- Hiring and training employees
- Covering HOA fees if the community has an exodus of members and doesn’t bring in as much money as it normally does
These repair reserve accounts are normally agreed upon before the HOA management company begins work. That way, the company and the community residents all know what the reserve accounts are for and how much money they need to maintain at all times.
Rule Enforcement
One of the most important responsibilities of any HOA management company is enforcing community rules.
Visit and “Patrol” the Community
HOA management companies may deploy employees to patrol the streets to check for things like:
- Trash and other sanitary violations
- Broken things in need of repair
- Obvious violations of community policies
Specifically, HOA management companies need to be knowledgeable about any given homeowners association “CC&R” or covenants, conditions, and restrictions. That means the management company needs to know what the HOA dictates in terms of things like shrub length, types of lawn grass, and where cars can be parked.
If an HOA employee spots a violation, it’s their duty to report and/or take care of the issue. These regular patrols also help to alert community members to potential hazards or threats. For example, if a wild animal like a wolf is noticed in the neighborhood, the HOA management company employee should send out a notice to all the residents to keep their dogs indoors for a while.
Send Violation Notices
If an HOA community violation is in the hands of a resident or homeowner, the HOA management company will send a notice about the violation to the relevant homeowner as soon as possible.
In theory, the HOA management company simply notifies the resident about the violation, the resident then solves the violation, and everything goes on smoothly. If the resident refuses to fix the violation, the HOA management company is then responsible for convincing them to change their mind or doing the work itself.
Take Complaints/Violation Notes
If a homeowners association resident notices a violation from one of their neighbors, they may write a notice to inform the rest of the community and to use social pressure to fix the problem. The HOA board may receive a copy of the note as well, but the management company is the organization primarily responsible for making sure the issue is fixed promptly.
Most HOA management companies maintain records of resident violations or complaints against them for the purposes of potential evictions. If a resident is repeatedly shown to be a problem in the community, the HOA management company may use those incidents as ammunition to evict them or get them to change their behavior.
Follow Up with Homeowners/Ensure Compliance
HOA management companies must follow up with homeowners if they were the subject of a violation notice or complaint and ensure future compliance regarding homeowners association rules.
This is an important duty because some homeowners association residents are unaware of their violations or don’t fully understand community rules, especially when they first arrive. For instance, a new homeowner might not know how their bushes should be trimmed or maintained.
The HOA management company is responsible for teaching the homeowner how to properly train and maintain the bushes (within reason – it’s not responsible for giving a complete course on gardening, for instance). Still, this kind of approach can help homeowners minimize unintentional violations and maximize community cohesiveness.
Answer Questions About Rules
If an HOA resident has a question about a rule, either for clarification or about the rule’s purpose, the HOA management company should have the answer for them.
HOA board members may also receive questions about rules. But many rules are implemented because of HOA management policies – for instance, community members may be forbidden from performing certain types of yard work due to perceived risk. The HOA management company should take care of that work instead.
Some management companies may have online portals or email addresses through which residents can send their questions for organizational purposes. That way, a dedicated office agent can answer questions from residents quickly and comprehensively, as well as carry on long-term conversations with residents if needed.
Maintenance Services
Like standard property management companies, HOA management companies usually tackle a host of maintenance jobs for their communities.
Keep the Common Areas Clean
This work can include:
- Picking up trash around the area, both inside and outside
- Making sure that office buildings or shared buildings look good (e.g., cleaning windows, cleaning doors, vacuuming carpets, etc.)
- Fixing any issues with common areas, especially recreational facilities
For example, if a homeowners association has a community pool, the management company is responsible for making sure that people use the pool properly, that it is covered in winter, that it is cleaned in spring, and that it regularly has new chlorine tablets to prevent the water from becoming contaminated.
Perform Groundskeeping Work
Groundskeeping work can include:
- Sweeping the sidewalks
- Picking up dog poop and making sure that dog poop bags are supplied to residents by disposal sites
- Taking care of seasonal groundskeeping tasks, like blowing leaves, shoveling snow, spreading salt on the roads after a snowstorm, etc.
- Maintaining community greenery, like shrubs, bushes, trees, etc.
If there’s a groundskeeping problem, residents are usually encouraged to bring the issue to the attention of the HOA management company rather than the board. Again, this helps to streamline maintenance requests and prevents the board from becoming overwhelmed with basic problems.
Fix Common Area Issues
Sometimes, common areas are affected by mechanical problems or messes, and the HOA management company is responsible to take care of those.
For instance, if a piece of gym equipment breaks at the shared gymnasium, the HOA management company should place an order for a new piece of equipment as soon as possible. They’re also responsible for telling residents that the gym equipment is broken, usually by putting a note up on the broken equipment.
Fix Limited Homeowner Amenities/Repair Problems
Some full-scale HOA management companies also handle in-unit amenities and repair requests, at least to a limited extent.
For example, if a homeowner has a problem with their dishwasher, the management company’s maintenance staff can take a look at the unit. Depending on what the problem is, the maintenance staff may fix it, order a new unit, or contact a third-party contractor to do more work.
In any case, homeowners submit maintenance requests for in-unit repairs rather than communicating with the HOA board.
Coordinate with Vendors and Contractors
Vendors and contractors can include companies and individuals who perform duties like landscaping work, common area maintenance, and so on. For example, if your HOA requires an arborist to come to maintain the trees after a rough winter, your HOA management company can be the one to initiate the contract.
Negotiate Vendor Contracts and Find New Vendors
If there’s a problem with a current vendor or contractor, your HOA management company can negotiate with them to resolve the situation or find a new vendor or contractor for your needs.
This ties into the above service, and it’s beneficial if your HOA board doesn’t include any members who are skilled at contract negotiation. Note that only the most comprehensive, full-service HOA management companies will provide this work to you – otherwise, your HOA board members will be responsible for finding contractors and vendors to suit the community’s needs.
Risk Reduction Services
HOA management companies are often responsible for reducing or eliminating risks in HOA neighborhoods.
Fix Safety Hazards
Many HOA management companies look for and actively fix any safety hazards they notice in community properties.
For example, an HOA employee might drive around and notice a piece of debris in the road that could be a hazard for drivers. They’ll remove the debris and clean up the community in the process.
Note that most HOA management companies aren’t responsible for fixing safety hazards that require the work of a specialized contractor. For instance, if a power cable goes down in the neighborhood, either the HOA board or the management company will need to call licensed electricians to handle the problem.
Notify Residents of Current Risks
In some cases, the HOA management company may handle notifying members of an impending risk, such as a flood, tornado, or nearby fire.
Administrative Services
HOA management companies often provide a variety of administrative services for homeowners association boards.
Coordinate Board Meetings and Take Minutes
HOA management companies frequently take minutes during board meetings so that members later know who said what and so there’s an accurate record of suggestions, complaints, and recommendations from community members.
Furthermore, HOA management companies often help to coordinate board meetings. They may send out potential meeting times to the community members or they may announce upcoming board meetings once those meeting dates and times have been decided by the boards themselves.
Handle Communications with Residents
To ensure that everyone in the community is kept up-to-date regarding guidelines and policies, HOA management companies may be responsible for communicating meeting decisions promptly.
For instance, if the HOA board decides to enact a new curfew policy for music and backyard policies, their management company should send out a memo to all the community members so everyone knows about the new policy.
Oversee and Advise on Architectural Changes
Sometimes, HOA members want to make architectural changes to their properties or to the surrounding community facilities. When this occurs, HOA management companies may oversee and advise community members on architectural changes.
For instance, if the community wants to erect a new fence around the neighborhood, their management company might:
- Make an estimate for how much fencing will be needed
- Make an estimate for how much the fencing will cost
- Help the community members understand what it will take to maintain a good fence
If a resident has a question about community policies regarding property modifications, an HOA management company or its staff may be able to answer questions about those modifications. For instance, if a resident wants to know whether they can make a change to their driveway’s shape or size, the management company should be able to tell the resident one way or another.
Additional Services
In addition to the above services, HOA management companies may provide additional benefits to HOAs, such as offering legal advice or even marketing homes within the community.
Offer Legal Advice
Depending on the size and sophistication of a given HOA management company, they may also have one or more lawyers in their employ. If this is the case, you may be able to ask your management company for legal advice regarding things like HOA policies, resident acceptance rules (under the Fair Housing Act), and so on.
Market HOA Homes
The most comprehensive HOA management companies may help homeowners association boards market homes in their communities. This can help bring new residents into the community and replace departing members quickly.
This marketing assistance can include:
- Creating marketing materials for the homeowners association, like posters or online advertisements
- Helping HOA board members list properties on real estate websites
- Connecting homeowners association boards with Realtors and prospective homebuyers
However, note that HOA management companies do not fully take charge of property marketing or real estate services. That’s outside their domain – you’ll likely need to contact a dedicated real estate office or agent for more assistance in these matters.
Service Differences Between HOA Management Company Types
Not every HOA management company will offer all of these services. There are a few different types of HOA management companies that affect what their scope of responsibility will be.
Full-Service HOA Management Companies
These are full-scale, comprehensive operations run by on-site managers. These are closest to traditional property management companies employed by rental property owners.
These HOA companies take care of the vast majority of necessary work, including maintenance requests, financial management, homeowner communications, bill collection, and much more.
Full-service HOA management companies are best for larger communities or associations that have struggling boards or not nearly enough volunteers for all the work that needs to get done. These organizations are also advantageous for HOA boards that want to learn more about how to run their communities efficiently and fairly.
However, full-service HOA management companies charge higher fees because they take on a much greater burden of the day-to-day work.
Remote Work HOA Management Companies
Remote work HOA management companies don’t handle most of the day-to-day operations associated with running your community. Instead, picking up trash, handling resident complaints, and other in-person work is left to your HOA board and volunteers.
A remote work HOA management company provides assistance with financial management, accounting, and administrative duties. Furthermore, these companies can provide virtual assistance for:
- Tracking and receiving maintenance reports
- Contacting and communicating with vendors
- Planning and helping you maintain reserve accounts
- Contract reviews
For many homeowners associations, remote work HOA management companies are cost-effective, in-between solutions that give inexperienced boards the support they need without costing too much money. These companies don’t usually charge high management fees.
HOA Consulting Services
HOA consulting services are ideal for HOA boards that are mostly well-functioning, but which require the assistance of an expert from time to time.
An HOA consulting service sends a consultant for short-term projects or advice, such as managing the association’s budget, helping draft notices to community residents who are in violation of community standards, etc.
With this type of service, you don’t get a lot of extra help from the company, but you also only pay one-time fees for the consultant’s work.
