Board members will frequently hear complaints from homeowners association members about paying their monthly HOA assessment fees. In fact, some homeowners may even shy away from purchasing a home or condo if the feel the monthly dues are more than they want to pay.

As the economy rebounds and the housing market has picked up a bit in most places, it’s important to remember that most people still are feeling enough of a pinch in their wallets to be concerned about overly high HOA dues. Most HOA board members are aware of this issue and do their best to control the assessments. However, our experience is that often times there are things that can be done if a board is serious about lowering the assessments.

It would be tough not to put a smile on every homeowner’s face if you announced that their HOA dues were being lowered; most homeowners are used to receiving notices that their monthly dues are increasing. Going into the New Year, you can make it a goal to try to lower those assessments.

What you can Do

  1. Review contracts and get quotes: One of the most effective ways to reduce your assessments is to take a look at your current contracts and then seek quotes from service providers. Most of your money is likely going into landscaping and property management. We find that many associations that have been in long-term contracts with their HOA management company are paying more than the industry standard. It’s smart to request bids every few years to make sure you’re paying a fair rate. A word of caution, though: there are plenty of companies that will low-ball you and end up providing you with terrible service. If you’ve been with the same landscaper or pool service company for a long time, it’s probably time to request bids as well to make sure you’re paying a fair rate.
  1. Ask for feedback: Check with your residents to see if there are things they would prefer to go without in order to lower their monthly dues. A majority may wish to replace some landscaping with xeriscaping, or not plant winter grass in order to save money. You may also be paying some vendors for services you don’t really need. Pest control services can sometimes be cut in common areas with little impact, or the landscaping committee can do the spraying for pests instead of an expensive vendor.
  1. Check your bills: Consider where your monthly bills are going when it comes to water, electricity, and other monthly fees to cover common grounds. You may even want to hire a company that will audit your resource usage to see where you can make some cuts. This may include reducing your water usage fees by replacing landscaping plants with those that do not need to be watered as often. There are all kinds of stories about homeowners associations that were paying an electric or water bill for a neighboring community and didn’t even know it until an alert community manager discovered it.
  1. Defer projects and maintenance: If there are projects that can be put off for a year or two, consider doing so. This will give people a chance to reduce the fees while the economy continues to rebound. There are many times when projects can be put off for a longer period of time without sacrificing the aesthetics of the community. Sometimes board members will have pet projects they want to spend money on but the majority of homeowners would rather go without in order to lower HOA dues.
  1. Rethink your reserves: Take a good look at the amount of money that is going into your reserves each month. Determine if you can scale back on that money allocation at this point. Doing so will help reduce fees for that time period. We have seen numerous neighborhoods that have a very large amount of money in reserves, and could easily scale it back and still be in great financial shape.

In taking measures to lower your HOA assessment, you don’t want to compromise the look of the community. Homeowners purchase in the community because they like the way the home and community looks. Even while keeping aesthetics and quality a priority, there are still changes that every HOA can make in order to reduce their monthly fees. By doing so, they will keep homeowners happy and maintain the property.

It can be easy for some board members to start acting like the government. It’s hard to be as frugal spending other people’s money. Be careful to not lose sight of how much an extra $50 or $100 can mean to homeowners each year. If you can find a way to lower the HOA assessments, you’ll go a long way in building goodwill between the HOA and its members. We’ve been impressed over the years at just how well most board members do in accomplishing ways to lower assessments. Keep it up!