Want a great way to almost guarantee you will be able to increase your property value in Salt Lake? Consider buying in a community with an HOA. There’s typically a good deal of confusion surrounding HOAs. While HOAs offer some definite benefits, there are some drawbacks to take note of – especially for those first-time buyers or sellers where the property is in an HOA. So let’s examine what HOAs do, what they can’t do, and how they can increase your property value in Salt Lake.
What HOAs Do
A homeowner’s association (HOA) “is a governing body that oversees a residential community, or often a planned community. HOAs are run by the residents of a community through an elected board of directors. Typically, but not always, theHOA board members hire a third-party management company to oversee the day-to-day operations of the community.”
The residents of the community fund the HOA through the payment of regular dues or HOA fees. Some HOAs collect dues monthly, and others use quarterly or annual assessments. So while an HOA can increase the value of your house in Salt Lake, it comes at a price – sometimes a pretty steep price.
A common misconception about HOAs and their boards is that they just want to be petty tyrants, quashing fun and stifling creativity. But that’s really seldom the case. HOAs offer benefits by doing the following, all of which serve to increase your property value:
- Ensuring property upkeep
- Promoting uniformity of standards
- Maintaining common areas
- Building and maintaining community amenities
HOAs have several functions and benefits, but their main purpose is to increase your property value. “It’s important to emphasize that HOAs have one basic mandate: to increase property values. That’s it. Everything else a neighborhood’s HOA does is with that goal in mind.”
What HOAs Can’t Do
While it may seem that HOAs have a frightening amount of power, there are somethings they can’t do.
Owing to the Fair Housing Act, HOAs can’t discriminate. An HOA can’t prevent you from purchasing or fine you on the basis of your race, ethnicity, religion, or sexual orientation/gender identity.
FINE YOU ARBITRARILY
In addition, HOAs can’t fine you arbitrarily – as long as you abide by and observe the rules and regulations. An HOA can’t fine you for a violation if it isn’t set out in the rules and bylaws.
CHANGE RULES ON A WHIM
HOAs can’t make decisions and rule changes on the fly, either. Changes must be made according to the rules set out in the CC&Rs.
HOAs are not above the law. If your HOA board acts in any underhanded way, you may have a valid lawsuit and can take the matter to court.
How HOAs Can Increase the Value of Your Home in Salt Lake
Several factors play a part in property values, and the presence of an HOA is one of them. Here are the major ways HOAs can increase your property value in Salt Lake:
“We’ve all been through a neighborhood where there was one home that stuck out among the others. Whether it was the unkempt lawn or a home painted a wild color, that one home could have a negative impact on the value of surrounding homes, even if they were kept tidy. Most, if not all HOAs have rules regarding lawn upkeep. This means yards must remain mowed, trimmed, and free of garbage and clutter. They also often have rules regarding what colors your home can be, so you won’t have a neighbor with a bright pink home affecting the value of your home.”
Homes in a neighborhood with an HOA usually sell for higher prices than homes in an area without an HOA. Typically, they are listed and sell for “5-6% more than their counterpart homes in areas without an HOA.”
HOAs can also increase the value of your home by ensuring that homes are kept up in such a way as to appeal to buyers. “Serious buyers tend to value homes based in communities with a homeowner’s association more than those without one since there are rules that will not only protect them and their home but the value of their home as well.”
HOAs increase property values by promoting neighborhood cohesion. The result is a neighborhood that looks inviting and well put together, where all the homes seem to fit appropriately.
Final Thoughts on HOAs and Property Value
Some people disapprove of and don’t like HOAs. But they can be a big plus for sellers because the HOA rules can increase your property value. “One of the main ways an HOA can impact home value is by making and enforcing rules. The rules an HOA makes ensure that all homes are clean, and yards are trimmed and free of garbage and clutter. This is important since having neighbors with unkempt, untidy yards can negatively impact your home’s value. An HOA works to protect the value of all homes in the area and ensure all homes work together well.”
Even though an HOA can certainly increase your property value in Salt Lake, you still have to be able to get that better price when you sell. This is where your local Salt Lake agent can be a huge asset. Don’t lose money on the sale. Send us a message or give us a call today at (801) 755-3865.