Two words that HOA owners despise: Special Assessments. Regardless of the improvement that is being made to the property or the emergency maintenance situation, all the owner hears is the cash register ringing. Special assessments are a necessary part of the HOA owner process but should be handled appropriately, and only really issued when deemed absolutely necessary. Below are a few guidelines to helping mitigate special assessments or avoid them in general:
1. Don’t vote on special assessments without membership approval – Seems like a no-brainer, but many times the members are not tuned in about the assessment. If they feel they are part of the process, they may be more apt to pay it.
2. Be honest when reporting to members about special assessments- Don’t lie or make up half truths. Be direct and professional.
3. Budget and Forecast appropriately – Are you planning for 5% cost of living increases each year? You should. Costs rarely go down and with inflation high, HOA boards should not forecast numbers less than previous years. Keep 3 and 5 year plans up to date, with the treasurer refreshing documents quarterly.
4. Have reserves – Aim to have 100% of your operating expenses in reserves in case of a natural disaster or other act that may inhibit everyone from paying. If not 100%, at least 80%.
5. Always get multiple quotes on repairs and maintenance – Cousin Bob a plumber? Make sure you get quotes from multiple sources before committing to one company. We may think we’re getting a deal from family, but sometimes it is not the case.
Working with a professional property management company like Cardinal Realtor can help with all issues pertaining to HOA’s. Call us today to discuss how we can help your HOA.