HOA management companies are common solutions to help run the day-to-day of an HOA. They’ll handle responsibilities such as billing, maintenance, enforcing rules, and more.
Do You Need an HOA Management Company?
There is no requirement to have an HOA management company. However, it can help the community run more smoothly and take some responsibility off the HOA board. They are also very beneficial under these circumstances:
- No one on the board has professional financial or legal experience
- HOA Board members spend a significant amount of time trying to collect fees
- Consistently searching for qualified handymen, repair companies, security solutions, etc.
- Board members need help fairly enforcing the policies and rules
What Do HOA Management Companies Do?
Some of the most common tasks of HOA management companies include:
- Billing and Collections Tasks
- Handling Administration
- Managing HOA Board
- Enforcing Community rules
- Completing Maintenance jobs
- Managing Risks
- Handling Evictions
- Marketing Homes
- Performing Legal Services
1. Billing and Collections Tasks
The majority of HOA managers tackle homeowners association billing and collections tasks. These can include:
- Billing any residents for HOA fees – Sometimes, having a third-party company handle this works out better for everyone than having a neighbor collect dues.
- Tracking down late or delinquent payments – Your HOA management company can handle tracking people down, issuing warnings, and even eviction proceedings.
- Issuing any notices related to bills to HOA residents – If prices need to go up, your HOA management company can handle creating and distributing notices.
When you contract with an HOA management company, you’ll be able to offload accounting work onto their experienced accounting professionals:
- Tracking HOA community member payments
- Budgeting for the HOA board and community events
- Ensuring that the HOA management company itself is paid on time and in full
- Filing applicable taxes
This service can be particularly valuable if no one on your HOA board has any accounting experience.
3. Handling Administration
Administrative work can include things like sending out notices about upcoming rule changes, construction work, or missing pets.
If your HOA board doesn’t want to take care of this work, you can offload it to your HOA management company instead. HOA management companies oftentimes work closely with HOA boards (though the details depend on the community and the management company you choose to contract with).
In addition, HOA management companies may assist with administrative services and tasks like:
- Contracting inspectors and specialized maintenance workers
- Working with third-party vendors or organizations, such as security companies
- Ensuring that community guidelines are up to spec compared to municipal guidelines and regulations
4. Managing HOA Board
HOA board management services can include things like:
- Taking minutes at HOA board meetings
- Taking feedback and complaint requests
- Organizing paperwork
- Planning for future HOA board meetings
These services are most important if you meet infrequently or if your volunteer HOA board members don’t want to do the work themselves. Some communities benefit from active HOA management companies while other communities prefer a bit of separation from HOA management organizations.
5. Enforcing Community Rules
Many HOA board members don’t want to handle community rules enforcement because they don’t want to compromise their relationships with the rule breakers. Alternatively, you may simply not have enough volunteers to tackle the work.
HOA management organizations can enforce rules by:
- Ensuring that everyone in the community understands HOA covenants and restrictions, such as house decorations, home improvements, and HOA dues
- Helping HOA members understand the rules
- Issuing warnings to those who don’t obey the rules
- Enforcing disciplinary measures against members that do not change their behavior
This allows community members to focus on their social ties without making anyone the “bad guy.” Furthermore, it ensures that there’s always someone willing to correct behavior that could compromise the home or property values of everyone in the community.
An HOA community member decides to paint their house a disapproved color. Instead of a neighbor having to tell them not to complete the paint job, the HOA manager can do that and enforce penalties against the homeowner if they don’t comply. This doesn’t affect any neighborhood relationships and maintains the HOA rules.
6. Completing Maintenance Jobs
HOA management companies oftentimes employ their own contractors or maintenance personnel to handle tasks like:
- Repairing basic plumbing and electrical elements/utilities
- Fixing damage to public facilities, like swimming pools, gyms, and parking lots
- Repairing basic structural or property damage, like a torn screen door
Furthermore, HOA management companies usually have a list of third-party vendors and specialized contractors they can contact if they can’t complete a specific maintenance job. For instance, if a home needs to be inspected by a licensed inspector once per year, your HOA manager will handle contacting the inspector and overseeing the inspection from start to finish.
7. Managing Risks
Sometimes, your HOA community may need to be protected against various hazards, including the weather, wild animals, and potential bad actors. HOA management companies can handle security and risk mitigation in a variety of ways:
- Patrolling the homeowners association and checking for property damage or signs of vandalism
- Contacting emergency authorities, like the police or fire department
- Installing and maintaining security cameras around public facilities, like the mailboxes
- Sending out warnings to HOA residents if there’s a threat nearby, like a wild animal (e.g., telling homeowners to keep their pets indoors)
- Warning homeowners about damage that could be hazardous on the road or in public facilities, such as potholes or fallen trees
This work is critical to many HOAs, as board members often don’t have enough time to handle these types of risks. HOA management companies can provide important peace of mind to everyone in the community.
8. Handling Evictions
HOA management companies can begin and follow through with the eviction process, including contacting law enforcement, handling paperwork, and taking care of court visits.
Evictions can take many weeks or months to resolve, so having an experienced HOA manager on hand to tackle this work is invaluable.
9. Marketing Homes
Many HOA management companies handle marketing services for the communities they oversee. This marketing can include:
- Creating and running advertisements for the HOA
- Working with the HOA board to ensure advertising materials fit the community’s image and preferences
- Maintaining a high-quality website to attract new residents to the community
Some HOA management companies may market homes with the input of the community members or the board. Others handle marketing without any input at all—be sure to know which is which before signing a contract with any management organization.
10. Performing Legal Services
Your HOA management company should stay informed about legal changes or restrictions, ensuring that your community also stays compliant with things like property safety and environmental requirements.
Furthermore, if your board ever becomes embroiled in a legal battle, your HOA management company may be able to provide legal counsel or assistance.
Many of the largest HOA management organizations maintain connections to dedicated law firms. This way, HOA board members are protected completely and community members don’t need to worry about difficult legal issues.
Types of HOA Management Companies
The type of HOA management company you decide to contract with impacts the services you can expect. The last thing you want to do is hire an HOA management company expecting them to do some services, only to find that those services aren’t included in the contract.
Here’s a breakdown of the different types of HOA management companies you can contract with.
Full-Service HOA Management Companies
Full-service HOA management companies are typically large, comprehensive companies that provide a range of services including:
- Management and running of HOAs
- Working closely with HOA boards
- Providing assistance and support to communities
Depending on the company you choose to work with, some full-service HOA managers may live in the community by establishing or setting up shop in an existing office. A manager or support personnel may live in units in the community, merging your HOA and the management organization.
Remote HOA Management Companies
Remote HOA management companies can vary in size, but they all provide their services remotely. Their managers never appear at homeowners associations in person, nor do they maintain any property in the community. Instead, they work online with your HOA board members.
They only provide services that can reasonably be completed over the Internet as a result. These services include:
- Accounting and bookkeeping assistance
- Administrative work
- Networking with third-party vendors, such as security contractors and maintenance personnel
- Legal assistance
- Community marketing and advertising
Remote HOA management companies are much cheaper than full-service companies. They’re also much easier to begin working with as the onboarding process is less intensive.
Contracted HOA Management Companies
Contracted HOA management companies only provide temporary, specific services.
If you need help getting your HOA tax paperwork in order, you can request the temporary assistance of an HOA management contractor to get your books ready.
Contracted HOA management companies can be very affordable since you don’t have to pay them all the time. However, they’re also not always available when you need them the most.
These types of management companies are ideal if you have lots of volunteers working for your HOA board or if your community is very small and you can manage it capably by yourselves.
How Much Do HOA Management Companies Charge?
Fees typically range from $10-20 per unit per month depending on the type of services offered. Most HOA companies charge in 1 of 3 ways:
- Monthly fee
- Flat fee per unit
- Percentage of the HOA member fee
Additional fees, such as those for onboarding, unexpected repair expenses, or legal fees in the event of evictions, may also apply.
How Is an HOA Board Different Than a HOA Management Company?
An HOA board should hold the “power” within an HOA community. While an HOA management company should have some responsibilities, the final say lies with the HOA Board.
Both the HOA board and HOA management company should each have clear tasks and responsibilities.
HOA board responsibilities may include:
- Creating policies, rules, and restrictions
- Setting an annual budget
- Setting fees and payment schedules
- Approving expenses
- Maintaining a reserve fund for large community projects