Do you ever feel lost deciphering your HOA’s financial statements? You’re not alone! This guide will equip you with the insight to confidently understand your HOA’s financial health and become an active participant in your community. Read the article…………………………….
What is HOA Balance Sheet And How To Read Them?
As a member of a homeowners association (HOA), it’s important to understand the financial health of your community. One key document that provides insight into an HOA’s financial position is the balance sheet. In this post, we’ll explain what an HOA balance sheet is, review its key components, and provide tips on how to read […]
POA, HOA fee hikes make it harder to afford property for some (TX)
Property association fee hikes are putting many people in a bind trying to hold onto their investment property or home. The fee increases started around the pandemic and show no signs of ever retreating. Read the article………………………………
Time for a Financial Check-Up (FL)
When did you last take a close look at your investment account statements, have a meaningful discussion with your financial advisor or broker, or reassess your investment goals and time horizon due to changing circumstances or major life events? Read the article…………………………
New law improves online protections for homeowners (NV)
This is the first of two columns by Las Vegas attorney Adam H. Clarkson. Today, he addresses Senate Bill 378, which imposes cybersecurity insurance and data protection requirements for homeowners associations’ online assessment payment processors. Next week, he will address what the new law says about email notices. Read the article………………………..
Monitoring Fraud in Condo Associations: The Do’s and Don’ts (IL)
Condominium associations hold a significant level of trust, as they are responsible for managing the community’s financial affairs and overall well-being. Fraud can have devastating consequences for the condominium, both financially and reputationally. Not only does fraud have the potential to break down relationships between neighbors, but it can also cause a significant increase in […]
Your Accountant Wants You To Know About Section 57 Of The Condo Act (MI)
Condominium associations with annual revenues exceeding $20,000.00 should take specific note that Section 57(2) of the Michigan Condominium Act provides that an independent certified public accountant must perform an annual review or audit of the association’s financial documents, including its books, records, contracts, and financial statements. Read the article………………………..
Sharing Community Financials
As a community association board member or manager, you are ultimately responsible for managing the finances of a business – your community. The association members are all stakeholders in that business, so sharing financial information with them is essential to building and maintaining trust and credibility. Read the article………………………..
Safeguarding Association Assets in Turbulent Financial Times (OH)
As George Bailey explained to the frightened citizens of Bedford Falls trying to withdraw their savings in the film It’s a Wonderful Life, “The money’s not here. Your money’s in Joe’s house. And in the Kennedy house, and Mrs. Macklin’s house, and a hundred others.” Read the article………………………..
Inflation and Capital Planning: What You Need To Know
Inflation. We’ve all heard the word, and frankly, we’re all probably sick of hearing it. The reality is that many associations may feel the impact of this current inflationary period, regardless of when it lets up, for years to come. Part of what makes this particular period of inflation so impactful is that prior to […]
How To Practice Checks And Balances In Your HOA
Practicing checks and balances in your HOA is a good way to protect the association’s funds, but not many boards even know where to begin. Fortunately, there are some steps you can take to ensure you keep your finances in check. Read the article………………………..
Metro Atlanta condo owners informed of financial trouble and liens (GA)
A metro Atlanta condominium complex informed its owners and renters that it’s in serious financial trouble. Meter readers showed up at the Treymont at Sugarloaf condos on Tuesday to check water usage. Read the article………………………..
Community Associations and Tax Returns – Yes, You Need to File!
You may have heard rumors that because your community association is a non-profit organization, you are not required to file a tax return. Unfortunately, that is not the case. Even though your association may not owe any taxes, you still need to file federal and state (as applicable) tax returns. Read the article………………………..
Can the HOA Board Borrow Money from the Reserves? (CA)
Homeowners associations (HOAs) are organizations responsible for maintaining and managing common areas and amenities within a community. To accomplish their objectives, HOAs require funds, which are raised through member assessments. Read the article………………………..
How To Financially Plan For Condo Improvements
Condo ownership comes with many financial planning considerations. It is important to plan for the cost of repairs and improvements that can arise, as well as the regular maintenance costs associated with owning a condo. In order to ensure that you have enough money saved up for any necessary upgrades or repairs, it is essential […]
Financial, Physical, & Operational Health: How Does Your Association Measure Up?
In early 2020, our firm was hired to prepare a reserve study for an unremarkable 136-unit, 12-story condominium in south Florida. It was the kind of association you could drive right by without noticing, not much different from all the other high-rise buildings in this coastal neighborhood. Read the article………………………..
Condo Board Wrestles With Ways to Pay for $7 a Million Facade Project (NY)
We’re working with a high-rise, 300-unit condo that needs about $7 million for facade work. At the moment, interest rates are increasing, so banks would probably offer them a 10- to 15-year loan at about 4.5%, maybe 5%. So the association’s monthly mortgage installment would be about $72,500, which would then be spread among all […]
Appeals court: HOA inspection fees unlawful (VA)
A challenge to inspection fees assessed by a homeowners’ association in a large development has succeeded after the Court of Appeals of Virginia found that the individual fees weren’t expressly authorized by the association’s declaration. Read the article………………………..
Managing Cashflow for Community Associations
The highest use of a community association manager is as an experienced, certified professional who eases the burden on volunteer board members with expert guidance and hands-on management of administrative, financial and maintenance tasks. Read the article………………………..
How Much Money Is Recommended to Keep in a HOA or Condo Operating Bank Account
We frequently are asked about how much money is recommended to keep in a HOA or Condo operating bank account. The answer varies as each HOA is unique (different sizes, different structures and amenities) and so has different financial needs. However, there are some rules of thumb and principles to keep in mind when you […]
HOA Financial Fraud Prevention: Protecting Your Community’s Assets (CA)
It’s 2023, and Homeowner Association (HOA) fraud is on the rise. With more and more HOAs formed each year, it’s becoming increasingly crucial for HOA boards to take proactive measures to protect their financial assets from potential fraudsters. Read the article………………………..
Does Recession Affect The HOA? How And What To Do?
One of the last things any homeowners association needs is a recession. But in what way can a recession affect the HOA? And what can HOA boards do about it? Read the article………………………..
HOA Bad Debt: How Does This Affect Your HOA’s Funds?
Like many other organizations, homeowners associations can also encounter a bad debt. But, what is HOA bad debt anyway? And how can associations prepare for this? Read the article………………………..
Bankruptcy Basics for Condominiums (MA)
During the COVID-19 pandemic, both the federal government and the Commonwealth of Massachusetts imposed foreclosure and eviction moratoriums. Due to these moratoriums, consumer bankruptcy filings fell dramatically as the urgency to protect assets, especially residential property, was no longer an immediate concern. Once the moratoriums ended, there was concern that a tsunami of bankruptcy filings […]
A Guide to HOA Budget, Accounting, and Finance
Understanding how to interpret your HOA management company’s financials are an important part of your role in an HOA. The management company you’re working with keeps detailed financial records and HOA members’ ability to read and understand them will be key in maintaining community funds. This skill set is even more important if you are […]
HOA Accounting Reports You Should Know That Are Not Financial Reports
Many homeowners associations focus on the operational side of community management. But, the financial aspect is just as important. And one of the ways to evaluate the financial health of the association is through HOA accounting reports. Read the article………………………..
Investing Association Reserve Funds—A Historical Perspective
When we discuss the best practices for investing association reserve funds in today’s world, it is probably best to review a bit of history with this topic. Community Associations began to take hold during the 1970s. During the 1980s, association reserve accounts began to grow. At the time, interest rates were substantially higher than today. Read […]
Telling Your Association’s Financial Story: How to Read Monthly Financials Properly
Have you ever found yourself looking at a set of association financials that appear to be a bunch of codes that need deciphering? Imagine the pressure of being a new community manager at your first Board meeting, and you are expected to explain the association’s financial position. The financial portion of the meeting is inching […]
Increases from Insurance, Inspections and Reserves Rattling Many Condominium Communities (FL)
A recent article in the Palm Beach Post chronicled the early signs of the financial strains that Florida condominium associations are beginning to experience. Unfortunately, these early issues involving increased insurance costs represent just the beginning, and things are indeed expected to get worse in the months and years to come. Read the article………………………..
Not My Building Not My Problem: Special Assessments, Cost of Repairs, and Who Has to Pay (FL)
Condominium associations exist in high concentration throughout Florida, many of which are made of a collection of buildings, and not just a single tower. Damage to buildings happens, and insurance is not always sufficient to pay for all needed repairs. So, what if only one of the buildings is damaged? Is every member of the […]
4 Ways Inflation Can Impact Your Condo and HOA
Condominium, homeowner (HOA), and townhome community association board members and property managers prepare budgets to cover operational costs. These expenses include services (ex. landscaping, snow removal) along with routine maintenance, repairs, and replacement over time to ensure the property remains in good condition. Read the article………………………..
HOA purchasing policies
Members of HOAs and condo communities pay fees that are used to maintain the development. A lot of that money goes towards purchasing materials and services. In order to ensure money is used ethically and responsibly, associations create and follow purchasing policies to guide boards, managers, and other staff who handle community finances. Read the […]
How to Investigate Suspicious Financial Activity in Your HOA
Today, a homeowners’ association’s (HOA’s) board of directors depends on technology to store contracts, banking information, and other confidential documents. While digitization increases efficiency, it also intensifies the potential for fraud and theft of community funds. Even with checks and balances in place, like collective oversight of a community’s financials from board members and community […]
Can your association pay all its bills during the 2022 inflation storm? (FL)
Most condos and homeowners’ associations prepared their 2022 budgets in the fall of 2021. At that time, the expectation was for 3-4% inflation in 2022. Unfortunately, we are now dealing with CPI inflation of 8.6% in 2022 and real inflation in South Florida feels even higher. Even if you included 5% contingency in your budget, […]
Money Laundering – What to Watch For
In 2020 the Foundation for Community Association Research discovered that community associations in the U.S. handle $96 billion dollars in assessments, and California communities alone manage more than $12 billion in association housing services (operations, physical asset management, reserves, capital improvements, conservation & environment). With so much money at play, associations need to be aware […]
Your Guide to HOA Finance, Accounting, and Budgeting
Keeping the association in good financial standing is one of the most important duties of an HOA board. Poor HOA financial management can have lasting consequences, so it’s crucial for board members to understand the basics of association finance. In doing so, they will know how to properly manage community funds and ensure the continued […]
Condo Column: Access to your money (NH)
An issue arises occasionally at condominium associations that arose lately at an association I am fortunate enough to represent, and a board member thought it might make a worthwhile column. He was right, so here we are. Besides, I don’t want to lose one of the readers or a client. Read the entire article……………………………….
Understanding the Basics of Board Financial Reporting
As a property manager or community association board member, sometimes it’s tough to remember that associations are businesses. Some of them are pretty large, with hundreds of thousands of dollars in dues collected and expenses paid each year. That requires regular, proactive monitoring to ensure that issues, like mistakes or variances, are quickly identified and […]
Condo Column: The crypto mistake (NH)
There have been rumblings in Condo World about cryptocurrency, i.e. digital money with no physical presence like coins or bills. A lot of people have made a lot of money by investing in it and seeing it double, triple or more in worth in a very short period of time. Good for them. Read the […]
HOA balance sheets
Balance sheets are used by all types of businesses. HOAs also use balance sheets to understand how much money is coming in, how much is going out, and how much equity they have. This financial document provides a clear snapshot of the company’s finances at any given point in time. The items listed on the […]
Distinguishing between maintenance responsibility and financial responsibility in the wake of damage to condominium property (FL)
Forgetting to turn on the air conditioner before heading back up north for the summer and coming back to find mold growth. An undetected pipe leak. Forgotten running faucets that spill over onto the floor and beyond. Read the entire article……………………………….
6 HOA Financial Reports You Need to Know
Homeowner Associations in Santa Clarita can involve lots of reports. Here are 6 financial reports that you need to know Read the entire article……………………………….
Financial Management and Planning is Key to a Healthy Condominium Association (FL)
We have all heard the old adage, “Don’t judge a book by its cover.” The same is true when it comes to condominium associations—you cannot judge the “health” of a condominium association by its polished marble floors or its breathtaking gulf shore views. The true lifeline of a condominium association comes from successful financial planning, […]
Preparing Your HOA for Inflation
Virtually, all economists agree that the economy is humming. The country’s unemployment rate is at the lowest level in 50 years. Housing prices are increasing in nearly every market in the country. The problem with all of the good news? Inflation. It is currently at the highest level in 40 years. Prices of everyday items […]
HOA Capital Improvements
When communities are built, they are done so to provide the lifestyle and amenities that residents desire at the time of development; however, as time passes, residents’ desires change, and so do their desired amenities for the communities that they live in or want to live in. In order for communities to keep up with […]
5 Ways to Keep Your HOA’s Financial Stability
Your homeowner’s association (HOA) will achieve success when its financial health is maintained. Your role as an HOA board member goes beyond ensuring that fees get paid in a timely fashion. You should be involved in the budget-making process and monitoring of financial expenses. Board members provide the availability of funds to cater to the […]
How to Get Your Condo or Homeowners Financial Records (FL)
If you live in a condo or homeowners association, you may wonder: where is all your money going? Do you have a right to the records, and if so how do you get them? Which is why one South Florida woman called Help Me Howard with Patrick Fraser. Read the entire article……………………………….
AB 1101 Signed! Welcome Clarity to HOA Financial Protection Requirements (CA)
AB 2912, passed in 2018, provided welcome protections to homeowners in HOA’s from fraudulent activities by those entrusted with managing an HOA’s finances. AB 2912’s protections included: 1) requiring Associations to secure fidelity bond insurance in an amount equal to or exceeding current reserves, plus three months of assessments; 2) requiring a monthly review of […]
The association suddenly needs a lot of money. How do you get it? Which way makes sense? (FL)
So many of our buildings are approaching the 40 year mark, requiring recertification in electrical and structural. Many buildings are younger yet still need major repairs to the concrete, balconies, pool decks and other portions of the common elements. The board is going to need a lot of money. Assuming you don’t have enough in […]