What is a Homeowner’s Association? What You Need to Know.

Perhaps you’ve been renting a house for a substantial amount of time. Or perhaps, you’ve only ever lived in an apartment complex. More often than not, you probably view buying your first home in Santa Fe as freedom from the insistent regulations of others over their properties. But take a step back and think again. While you may have a decent say about your own home, afterall you are literally purchasing the property, there are still many factors that come into play with a owning a home. Just one of these factors is known as a homeowner’s association, or an HOA. When you’re looking at real estate in the Santa Fe area, it’s a good idea to look at all the different things that can dictate your choice of house, including the HOA.

What is an HOA?

A homeowner’s association is a neighborhood or community association that creates rules that govern a particular community. These rules can vary from what color you can paint your house to if you can be fined for letting your lawn grow too long. The goal of a homeowner’s association is to have a group of likeminded individuals maintaining the property in the designated community. These groups can also involve fees that are collected by the HOA to help maintain shared community property, such as a pool or the neighborhood entrances. By buying a home in an HOA area, you agree to the fees and terms set forth by the organization. Some people love HOAs, while others would rather do without, it’s simply based on preference.

What else should you watch out for?

In addition to HOAs, it’s important to keep any eye out for other neighborhood organizations and governances when you’re looking for real estate. For example, even if there is no HOA, there are also neighborhood organizations that may maintain joint recreational facilities that you may have to pay fees for. These can have many benefits if you’re willing to pay the fees. In addition to recreational organizations, if you find real estate you love, but you want to make improvements or changes, keep in mind that along with the neighborhood, the city may have ordinances that require special permits and specific structural limitations. Keep this in mind prior to closing on the property.

Keep This in Mind!

It’s important to know pretty early on if you’re willing to pay HOA fees or if you’d rather avoid having an HOA all together when you look at real estate. If you’re okay with an HOA, make sure you factor the cost of the fees into the amount you can afford for your mortgage payment. Keep this in mind because when you buy a home with an HOA, you’re entering into a legally binding contract that dictates that you follow all HOA regulations. You don’t want to be surprised by this after you’ve reached the closing table for your new home.

Homeowner’s associations both have benefits and drawbacks when you’re buying a home. More often than not, an HOA is about your personal preference and what you’re looking for in a neighborhood. Just make sure you aren’t caught unaware!