You move into your dream home and almost every house on your block is perfectly kept up. From immaculately painted houses to the mailboxes standing flawlessly by the curb, it’s like you stepped into the picture-perfect neighborhood…except for that one house at the end of the street with its leaning mailbox and overgrown lawn.

Did you know that one house can impact your property and neighborhood value alone? That’s why homeowners associations (HOAs) were created. To protect you from the one neighbor who wants to single-handedly destroy your investment!

Things to Consider When Purchasing a Residence With an HOA

Before you buy your new place, there are some things you should consider about HOA fees.

  1. HOA fees can change depending on projects and other circumstance
  2. HOA fees don’t cover everything – assessments can run you a pretty penny
  3. HOA fees can impact your credit, meaning if you don’t pay, they can send your account to collections
  4. HOA fees pay for things you might never use like a pool
  5. HOA fees are not usually deductible, but you’ll need to check with your accountant
  6. HOA fees may be due at closing
  7. HOA fees pay for a master insurance policy for the community, but not for your property, so you’ll have to find insurance for your residence

A well-run HOA can be a blessing and help increase the value of your property by 4.2%. But, a poorly-run HOA can be your worst nightmare. If it doesn’t manage the community and finances properly, you may end up coughing up a ton of money. Ultimately, it is your responsibility to check out the rules and regulations to decide if they work for you.


To help you out, we made this handy checklist of questions you need to ask the HOA before you buy.

FREE Checklist: 7 Questions You Need to Ask Before You Buy

Ready to Learn More?

If you want to dig deep into what an HOA is, we got you covered with our ebook “When Fees Are Too High.”