The single biggest cause of lawsuits involving property ownership today probably revolves around homeowners' associations (HOAs). Its members run the HOA, and it could be badly run. You should carefully check out the HOA, if your property has one, before you buy. A red flag exists and/or past law suits. Also, see if the HOA has enough in reserve to pay for scheduled maintenance, such as roof replacement and painting. And ask existing owners if there are problems with the HOA not otherwise evident.

 

All Hawaii condominiums and townhouses belong to a HOA. A co-op has a similar arrangement and some single-family detached homes belong to HOAs as well. If you are buy­ing in any sort of a planned development or community, chances are the home will have a HOA. Be sure to ask to see the bylaws, and the covenants, conditions, and' restrictions (CC&Rs), as well as any other pertinent infor­mation.

 

The HOA takes care of all property owned in common. This often includes walking paths, grounds, and ameni­ties such as swimming pools, spas, and recreation rooms. It often will also be responsible for the outside mainte­nance of the building, including roof, walls, fences, and so on.

 

The monthly dues unpleasantly surprise most buyers when they first buy a home that belongs to a HOA. Today these dues can frequently be between $150 and $300 a month. That is a substantial amount and particu­larly daunting when added to a mortgage, tax, and insur­ance payment. As a consequence, I have had buyers ask if they could withdraw from the HOA—do any upkeep and so on themselves—and not pay the monthly dues.

 

Unfortunately, that is not possible, unless all of the other HOA members agree, which is most unlikely. The HOA normally comes with the property and is included in the CC&Rs, which lists just what it says.

 

However, even though the dues may be high, be aware that you often get value for your money. You probably won't have to pay much, if anything, for outside upkeep. And the HOA may additionally pay for fire, flood, or earthquake insurance. In other words, much of the money you pay in HOA dues may come back to you in benefits.

 

Beware of bad HOAs. Boards composed of homeowner members run these associations, and some­times things don't work out very well. Some members become so angry with what they consider unfair decisions that they won't talk to each other for years. I have seen actual fistfights break out at HOA meetings! Usually you can determine how. Also, take the time to ask some neighbors. Often they can and will give you the lowdown.

 

Additionally, you may want someone experienced with HOAs, an attorney or accountant, to check out their books to see how financially solid they are.

 

Finally, you are entitled to see all HOA documents that affect your home before you buy. Insist on seeing them. If the sellers or HOA cannot make them reasonably avail­able to you, then that in it is a very bad sign.