top of page
  • Wise Property Solution

The Delusion of Low HOA Fees

When buyers look at condos or homes in an HOA, their first question is often how much are the association fees. For many buyers, low HOA fees are attractive. In newly built or converted condos, fees can be kept relatively low because new systems are in place. An association may be able to defer dealing with costs for replacement items like roofs, windows, and painting and keep fees artificially low. They defer funding long-term maintenance this at their own peril as prudent reserve funding during this time would have made funding reserves most manageable for all homeowners. Funding reserves from the beginning gives the HOA plenty of time to save enough to pay for replacements. This isn’t as true as buildings and facilities age.

One thing that is as certain as taxes is that costs will continue to rise. Increases in costs for roofing, windows, and other maintenance over the years require HOA fees to increase. The idea that HOA costs can remain forever low is a delusion.

Many Association Boards are adamant about keeping HOA fees low because they feel this adds value to homes. Contrary to the popular opinion, low HOA fees should be a red flag to buyers (especially when coupled with underfunded reserves). Without adequate reserves, HOA owners have to write checks for significant amounts with little warning. Then, it’s not about an extra $10 or $20 a month, but about potentially thousands of dollars right away. To add to the woe, HOA fees may still need to jump by 15% or more to rebuild reserves.

When an HOA relies on special assessments to do repairs, this can result in repairs that are more expensive. The Board has to give notice to owners and vote for a special assessment often resulting in added expenditure of both time and money. If the repair is urgent, the association will likely need to move quickly with the repair while working to authorize and collect the special assessment needed to fund the repair.

Buyers beware that low HOA fees are not always what they seem. Buyers should inquire about scheduled maintenance and an association’s history of special assessments. A little due diligence should consider both the financial strength and beliefs of the HOA. Assess both the association maintenance fee and association maintenance plan for the condo or home you’re considering.

The bottom line is that a low HOA fee is often a delusion. Ask questions, review documents and assess the situation before you opt in.


Wise Property Solutions serves condominium and homeowners associations by addressing their financial, association and facilities management needs. The only certified and licensed community association management firm serving the Mountain South (Virginia, North & South Carolina, Tennessee) with offices in the Tri-Cities and Knoxville.

bottom of page