Any member of an HOA knows there are important fees to be paid; however, understanding HOA fees can sometimes feel complicated. Different payments are required for different services, which must often be paid at different times.
Keeping track of all these can be overwhelming, especially for first-time HOA members. It can be even more confusing for the HOA board members who are supposed to track and collect all these fees.
Experts at Wise Property Management, one of the leading St. Petersburg HOA management companies have put together the following guide to make understanding the difference between HOA dues and HOA assessments simple.
What Are HOA Dues?
HOA dues are recurring payments due to the community from its residents that help cover the costs of regular maintenance, upkeep, and community facilities. Board members (or a St. Petersburg HOA management company) calculate these payments based on the budget proposed at the start of the year.
These fees will be divided equally across all residents based on the HOA board’s governing laws and state requirements. If residents feel HOA dues are too high, they can request a budget walk-through that calculates the total for reference.
These fees include landscaping costs, amenity upkeep, vendors, and management costs. There are minimal reasons a resident can defer a payment, and failure to pay an HOA due can result in fines to your resident account.
What Is the Purpose of HOA Dues?
HOA dues usually allow your community’s common grounds to remain maintained and community areas to be kept up with minimal effort on the residents’ end. HOA dues are vital to the community’s ecosystem.
cEnsuring residents are aware of the importance of HOA dues and pay HOA dues on time is extremely important. Without HOA dues, a community would be unable to function properly, and simple maintenance could not be completed.
What Are HOA Assessments?
Conversely to HOA dues, HOA assessments are a one-time fee imposed to cover unexpected costs that may come up throughout the year. This fee is not consistently implemented but only calculated when a significant, unexpected expense arises.
HOA assessments usually arise from a natural disaster that causes unexpected property damage, a large number of residents who have defaulted on their HOA dues, or a miscalculation in the yearly budget planning.
These circumstances can cause a need for a one-time HOA assessment to be implemented to help with budgeting purposes so all regular maintenance that otherwise the HOA dues would cover can be carried out.
What Is the Purpose of HOA Assessments?
Some community members may feel like an HOA assessment is redundant. If HOA dues are calculated at the start of the year, why should there be the opportunity to add more fees?
It is important to understand that HOA assessments are meant to be used in case of emergencies only. While the budget is calculated at the start of the year, unforeseen circumstances can leave an HOA needing its community to work together to solve a budget issue.
Help your board manage all HOA dues and HOA assessments with the help of a top St. Petersburg HOA management company, Wise Property Management. Call us at (813) 968-5665 or request a proposal today. We look forward to working with you!