A community association is simply a private, non-profit organization made up of property owners who live in the community. You automatically become a member of the Association the day you close the escrow on your new home. The Association is governed by a set of documents called Covenants, Conditions and Restrictions, the Statutes and the Rules and Regulations that all residents of the community must comply with. In essence, community associations are mini-governments. The Association’s primary responsibility is to protect and improve the health, safety, and welfare of its members, including property owners. Since each member’s greatest asset is her home, the Association faces no small task.
Most of the country’s cities have transferred responsibility for governance and maintenance to individual associations, therefore developers are now required to establish a community association to manage community affairs. The growth of community associations across the country is phenomenal. As of 2008, there are over 300,000 associations, which is extremely impressive when you consider that there are only 38,000 local governments in the United States.
Annually, your Association elects the members of the Board of Directors. The Board has a fiduciary responsibility to make decisions that protect its investment and the common ground of the Association. This is sometimes not an easy task as there are many owners in the Association, all with different opinions and suggestions on how to conduct the affairs of the community.
Why do I have to pay fees?
The Association by legal definition can be a Planned Community (Single Family Homes) or a Condominium (Multi-Family Units). Your assessment pays to maintain, improve and enhance the common areas of your community and provide for the operation of your Association. In Condominiums, the common areas can be roofs, walls of buildings, streets, grounds, lakes and swimming pools that the Association is obliged to maintain. The landlord is responsible for “Limited Common Areas” such as the front yards or adjoining patio walls, the backyard, the balcony, the front gate, the front door of your unit, and the windows of your unit. In a Master Planned Community, the entire lot and house are maintained by the owner and the common area, such as parks, pool, tennis courts and community landscaping, is maintained by the Association. In Condominiums, your assessment also pays for water and sewer, and a portion of your assessment is reserved for future repairs and replacement of common areas. The Board of Directors has the difficult job of trying to keep your assessment as low as possible while also keeping the common areas maintained and in attractive condition. What the Association does to improve or enhance the common areas affects the value of your investment.