HOME OWNERS’ ASSOCIATION: RATHER FRIEND THAN FOE

After months of searching, Phillip and Kate finally found their dream home … only to be told that membership of the Home Owners Association (HOA) will be compulsory. What exactly does this mean and what will this involve?

A HOA consists of all property owners in a particular housing scheme / development. The owners, who form the HOA, will usually elect Trustees at the annual meeting who, among others, look after the owners’ interests, apply the rules and handle the finances on behalf of the owners. The HOA’s management is not governed by law and any HOA therefore has it’s own Constitution which bound the owners in the housing scheme.

It’s easy to immediately link a negative connotation to a HOA. Who would want to live in a house, but still have to adhere to rules and regulations and pay levies, as in a sectional title complex?

Before Phillip and Kate turn away discouraged, they should carefully consider the benefits of membership in a well-managed HOA.

One of the most important factors to consider is safety. With the rising crime rate in South Africa, naturally the safety of you and your family should be a prime consideration when viewing potential properties. The costs related to the security of a home should be considered carefully. An advantage of some HOAs is the fact that the property is located in a closed complex. The complex may have some degree of security, such as an electric gate and electric fence, to strict security features where guards control access to the complex.

Furthermore, the aesthetics should be considered. A HOA’s Constitution, which all owners are bound to, often determine the aesthetics of the houses. This may include guidelines from the architectural style of the houses, to the shades of paint that should be used. This ensures that all the houses form a neat unit and all owners are obliged to keep their property in a good condition. It does not matter how well you take care of your house and garden, if your neighbor’s property is dilapidated and his garden overgrown with weeds, your good maintenance will not have the same effect as in a well-managed environment.

As mentioned, a HOA’s constitution provides rules that owners must adhere to. The rules ensure that all residents live in harmony and that offenders are prosecuted appropriately. If you reside in a non-governed neighborhood, for example, and your neighbors have wild parties for nights on end, your defense as “neighbor” is fairly limited and it may take weeks before the problem is solved. On the other hand, the trustees of a well-managed HOA will be able to handle such conflict quickly and in a civilized way.

The members of the HOA can contribute to it’s effective functioning by ensuring that all residents are aware of the Constitution and receive a copy thereof, so that they know what is expected of them. On the other hand, Trustees can on their side ensure effective management by applying the rules consistently and treat all residents in the same way and punish them when rules are broken. Furthermore, the trustees of a well-managed HOA, for example, first talk to offenders before proceeding to issue a penalty. This will prevent the residents from developing a negative feeling toward the HOA and in the end be unwilling to give their co-operation.

Should you consider to purchase a property where you are required to become a member of a HOA, it would be wise to ask for the financial statements to ensure that the funds are well managed and that the Association is financially strong. Furthermore, you can also ask for the Minutes for the last few meetings held. This will give you insight to the type of problems experienced by owners in general, and how these problems are solved.

Trustees should manage a HOA in such a manner that dealings with them creates a positive feeling and is to the benefit of all owners in the housing scheme.

Author: Riëtte Smuts

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice.