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Does an HOA have to conduct a reserve study?
First off, let’s briefly uncover what a reserve study is and what it entails. It is merely a report that reflects the useful life each common area component has remaining. Also, the report assigns dollar amounts associated with each component. These amounts reflect the amount needed from each owner to replace each item when it’s life ends. This is a very common question and the short answer is YES! Per Civil Code §5550, an onsite reserve study must be conducted once every three years. The following link will lead you to the actual law and guidelines: Furthermore, this report shall [...]
Paying too much for your monthly HOA dues?
Paying too much for your monthly HOA dues? A lot of homeowners think that paying a high amount for their HOA dues is bad. However, it is better to pay a higher amount rather than have low reserve funds. Every HOA has a budget and a reserve study report. Those tools determine what the monthly HOA dues shall be. The board of directors shall exercise due diligence in setting the right amount. This amount shall be enough to cover monthly expenses, budgeted items as well as monthly reserve contribution. By doing so, the HOA will have a less likelihood [...]
What is considered common area?
In the property management world, common area is a widely talked about topic, especially in the HOA space. Within Homeowners Associations, a maintenance issue either falls under the umbrella of common area or the homeowner. Every HOA has a set of CC&Rs (Covenants, Conditions & Restrictions). Within this extensive document lies all the rules of the HOA. A section of the CC&Rs highlights the distinction of maintenance issues contrasting homeowner's responsibilities and common area issues. If an issue is within the common area then the HOA will be the responsible party to pay and rectify the matter. Although every [...]