Do HOA's add or decrease from a homes property value?

Question

I'm trying to decide to help keep or rid of one. I have enjoyed living in a clean area, but I keep reading about other peoples bad experiences.

Answer 1

If your HOA is a good one, they will invest the dues properly and vote to add things to increase the property value of the home. However, if your HOA is a bad one, then they will do stupid things and waste the dues on frivolous items that will devalue or do nothing to help increase the value of your home.

So.. it just depends on the HOA that you have. Go to the HOA meetings and judge for yourself.

Answer 2

I don't think that the existence of an HOA or condo association is a factor that is considered. Market value is everything. If the HOA helps to keep the neighborhood looking clean and neat and safe--a principal function of an HOA--then that will raise the market value of homes in that area, compared to an unregulated area where there is debris in the yards and the neighbors park their trucks on the lawn and the fences are overgrown with vines and weeds.

However, an HOA's assessments might the buyer's ability to get a loan, since the assessments are like mortgage payments in that, if you fall behind, they can put a lien on the property and force a foreclosure. So the assessments have to be taken into account like PITI (principal, interest, taxes and insurance) in terms of the borrower's ability to meet the monthly payments on the property.

Answer 3

Your answer is determined by the quality of your HOA, its set of regulations, and how the HOA enforces those regulations.

Many HOA's are excellent, with sensible rules and decent governance. Others are extremely restrictive and tend to operate as if they were Adolf Hitler.

As far as values go, I don't think it makes a great deal of difference whether or not you have a HOA. Those who might want to purchase your home and have read of the bad experiences will avoid your property. Those who look for the restrictive levels provided by a HOA will seek out properties having same.

Answer 4

While in theory a good HOA can enhance the value of the properties in the association's area of authority, my personal experience has been to the other end of the spectrum.

It usually degenerates into a bunch of neighborhood nazis sticking their noses into everyone else's business and telling you what you can and cannot do with YOUR property. They tend to degenerate into a Cliquedom where if you're on the inside you'll do OK but if you're not your life won't be worth the can of gas to self-immolate. (I actually had a pinhead make a stink about the spacing of the pickets in a fence being 1/4" too wide and forced me to take the fence down.)

Needless to say, I'll never own a property covered by a HOA again.