You may be thinking about mortgage rates, home prices, your down payment, and even your closing costs when you buy a house. But homeowners association (HOA) fees might not be on your mind. You might not have these, but you should be aware that it’s possible, depending on where you choose to live.
A homeowners association (HOA) is a group that manages a neighborhood of homes, including common areas, and makes rules about things like upkeep. For some buyers, a HOA is a great perk, but for others, the fees may just be an extra cost. It’s important to know what they cover and decide for yourself if the benefits are greater than the costs.
The Benefits of Having an HOA
Take a look at this. If you fell in love with a house because of how nice the neighborhood looks, like the landscaping, the well-kept streets, or the way it looks from the street, it’s likely that the HOA is part of the reason why it looks so good. Here are some of the best things about it:
- Neighborhood Maintenance: Many HOAs take care of the landscaping, clearing snow, and general upkeep of common areas. This helps keep the neighborhood looking nice overall.
- Amenities: As well as the main features of the home, some HOAs may offer extras like a pool, clubhouse, fitness center, or even private security. In these situations, you do have to pay a HOA fee, but you save money because you don’t have to pay for separate gym and pool memberships.
- Property Value Protection: Because HOAs enforce community rules, they keep homes from getting worse. You don’t have to worry about eyesores in the area lowering the value of your home.
- Less Personal Upkeep: In some neighborhoods, the homeowner association (HOA) even takes care of repairs to the outside, the roof, and other shared duties, so homeowners don’t have to do as much.
HOA Fees: More Common, Especially in Newer Neighborhoods
Does every house have to pay HOA fees? No, not every house has one. But they happen a lot, especially in newer neighborhoods. The Wall Street Journal (see graph below) says that more than 80% of newly built single-family homes are now part of a HOA:
But homeowners associations aren’t just for brand-new homes. Homes that have been lived in before may also have a HOA fee. Axios says that in 2024, about 4 out of 10 homes had a HOA.
HOA Fees and Your Home Search
As you look for a home, ask your real estate agent which ones have HOA fees and which ones don’t, as well as how much those fees are. In some areas, dues are due every three months, every month, or not at all. A report from Realtor.com says that the average HOA fee went up to $125 per month last year, just to give you an idea.
Keep in mind, though, that the prices vary, and sometimes the fees give you access to great benefits. Chief Economist at Realtor.com Danielle Hale says it this way:
“People who are thinking about buying a home with a HOA should find out what benefits it offers, such as maintenance, security, or shared amenities, and how the HOA fees fit into their overall budget.”
Bottom Line
Before you buy a house in a HOA community, you should look over the rules and fees to make sure you understand what’s included, how much it costs, and if there are any restrictions.