HOA Management – a double-edged sword for home owners

As elaborated previously, the house we purchased in 2004 was located in Bay Farm Island in Alameda. The responsibility for the upkeep of Bay Farm, a huge community with over 3000 homes lay with two governing bodies – an HOA Management body exclusive to each subdivision, and a general HOA Management body dedicated to the common areas of the entire island. We rubbed shoulders with HOA Management on numerous occasions and below is its summary:
  1. One would think analyzing the works of replacing/extending old fencing would be the last thing the HOA would want to spend time and energy on. But, our experience proved otherwise. We submitted an application for extending the side-fence along with replacing the existing fence noting our preference for a full fence sans a lattice to provide privacy to the dining room. The application was approved without a hitch. Two weeks after completion of the work, the HOA Management notified us of a mistake in their approval. Apparently the lattice was key to maintaining the overall appeal of the community and as it was their oversight they offered to address it at their expense. Our counter argument was that there were plenty of other houses without the lattice on the side-fence. HOA agreed but concluded a review would be required regarding the other properties. Realizing this back and forth would continue with no end in sight, we let the lattice be installed and nothing happened with respect to the other properties that had installed fences without a lattice. Apparently, the original builder had installed all fences with lattices and HOA Management guideline is to enforce that look on those choosing to follow the rules.
  2. we made an unfortunate decision to replace the mulch in our front yard with lava rock HOA Management got involved again . Their threatening letter insisted on the immediate removal of the "rock garden" that had appeared in our front yard. After sparring a while, we realized even with a legitimate reason, without help from within the HOA Management body, you are up against a brick wall.
  3. The applications for the outside paint job, roof and window replacements were approved without much murmur – HOA Management did its due diligence and got us to commit to the exact material, color palettes, and window specifications beforehand. It is this professional eye for detail, we must say, that helps promote the consistent look in the community.
  4. The application to shift the common fence forward on the side of our house went predictably smooth for our neighbor sharing the fence was on the HOA Management board.
  5. When time came to sell the house, our intrepid agent, as part of his staging plan added several improvements to the front and back yard. It was amazing to see an elevated flower garden, a new lawn, etc materialize in our yard without having to bat the HOA. Later, when we received the letter from HOA Management seeking explanation, our agent calmly picked up the communication and we never heard from the HOA Management again – when the best selling agent in the area does something to a house, it is considered enhancing the value of the properties around and approvals are automatic even if the improvement stretches the limits of the "consistent look" mandate!
Below are the pros and cons of living in a large community with an active HOA Management:
  1. HOA Management can be immensely valuable, especially for larger communities where dealing with the local government, the communities and businesses within and in the vicinity is a given.
  2. The HOA Management bears the burden of keeping the appeal of the community a notch above the other public areas under the guise of “keeping the home prices up”. Overall, if done right, it is a net positive.  
  3. HOA Management is empowered to infer guidelines that are open to interpretation and to responsibly enforce them. The simplest way to do away with the pain of the remodeling approval process is to be a member of the board. It is relatively easy to land that thankless but time-consuming job. An effective strategy commonly adopted is to be committed to HOA Management Board duty for a year and in that duration get the improvements to your own house done.
Related Posts:
Last Updated: 03/2012. 



    No comments :

    Labels

    401k ( 15 ) ACT ( 1 ) AP ( 4 ) ARIUS ( 1 ) Abad Turtle Beach ( 1 ) Abrams Capital Management ( 5 ) Acoustic Electric Guitars ( 1 ) Acoustic Guitars ( 1 ) Activist ( 4 ) Address Change ( 2 ) Advanced Placement ( 4 ) Akre Capital Management ( 18 ) Alex Roepers ( 5 ) Appaloosa ( 15 ) Arlington Value Capital ( 3 ) Atlantic Investment Management ( 5 ) Ayemenem ( 1 ) BDCs ( 3 ) BP Capital Management ( 2 ) Bangalore ( 3 ) Bangkok ( 2 ) Bannerghatta National Park ( 1 ) Battery Park ( 1 ) Baupost ( 2 ) Baupost Group ( 17 ) Benjamin Graham ( 2 ) Benjamin Graham Model ( 2 ) Berijam Lake ( 2 ) Berkshire Hathaway ( 35 ) Bill & Melinda Gates Foundation ( 45 ) Bill Ackman ( 19 ) Bill Gates ( 44 ) Blue Ridge Capital ( 16 ) Blum Capital Partners ( 12 ) Boone Pickens ( 2 ) Brave Warrior ( 3 ) Brave Warrior Advisors ( 20 ) Bruce Berkowitz ( 19 ) Bruce Fund ( 38 ) CANROYs ( 7 ) CBRE ( 2 ) CEF ( 2 ) CLEP ( 1 ) Camcorders ( 3 ) Cantillon ( 12 ) Carl Ichan ( 8 ) Casio ( 2 ) Charles Akre ( 15 ) Charlie Munger ( 41 ) Chase Coleman ( 16 ) Chou Associates ( 29 ) Christmas gifts ( 7 ) Christopher H. Browne ( 7 ) Chuck Akre ( 13 ) Cisco ( 2 ) Class Action Settlements ( 2 ) Coatue Management ( 28 ) Cochin ( 2 ) Consumer Product Reviews ( 29 ) Covered Calls ( 2 ) DAT ( 1 ) DCF ( 2 ) Daily Journal ( 38 ) Dalal Street ( 8 ) Dan Loeb ( 10 ) David Abrams ( 5 ) David Einhorn ( 22 ) David Swensen ( 17 ) David Tepper ( 15 ) David Winters ( 15 ) Digital Piano ( 3 ) Dinakar Singh ( 20 ) Donald Yacktman ( 10 ) Duquesne ( 34 ) ESL Investments ( 14 ) ESPP ( 6 ) ETF ( 2 ) ETN ( 2 ) EXPLORE ( 1 ) Education ( 37 ) Edward Lampert ( 21 ) Egerton Capital ( 43 ) Egypt ( 3 ) Elementary Education ( 10 ) Elementary School Textbooks ( 5 ) Eric Mindich ( 13 ) Eton Park ( 13 ) Everyday Musings ( 58 ) Exam Prep ( 7 ) Exiting the rat race - how to? ( 19 ) FD Laddering ( 1 ) FVE ( 2 ) Fair Value Estimates ( 4 ) Fairfax Financial ( 4 ) Fairfax Financial Holdings ( 14 ) Fairholme ( 19 ) Fairpointe ( 28 ) Family Office ( 18 ) Financial Independence ( 93 ) Fisher Asset Management ( 10 ) Flash Camcorders ( 3 ) Flip ( 3 ) Francis Chou ( 29 ) Frugal Living ( 34 ) Fund Holdings ( 961 ) GMAT ( 1 ) GRE ( 1 ) Genting ( 2 ) Glenn Greenberg ( 24 ) Glenview Capital ( 18 ) Google ( 2 ) Gotham Asset Management ( 7 ) Greenlight Capital ( 22 ) Guitars ( 3 ) HELOC ( 1 ) HOA ( 3 ) Half Marathon ( 2 ) Hawaii ( 2 ) Hedge Funds ( 1230 ) High School Education ( 7 ) High School Textbooks ( 6 ) Holidays ( 3 ) Holyland ( 11 ) Home Improvement ( 2 ) Homes ( 18 ) Homeschool ( 18 ) Houses ( 2 ) Housing ( 3 ) Hykon ( 2 ) Ian Cumming ( 15 ) Icahn Enterprises ( 6 ) Infinuvo ( 6 ) Insurance ( 3 ) Investment Portfolio ( 96 ) Investment Research ( 10 ) Investments ( 7 ) Irving Kahn ( 17 ) Jason Maynard ( 10 ) Jefferies ( 2 ) Jeffrey Bruce ( 39 ) Jeffrey Ubben ( 26 ) Jerusalem ( 2 ) Jim Chanos ( 20 ) Joel Greenblatt ( 7 ) John Armitage ( 44 ) John Griffin ( 16 ) John Paulson ( 17 ) Joho Capital ( 23 ) Jordan ( 3 ) Joseph Steinberg ( 9 ) Julian Robertson ( 4 ) KWA ( 2 ) Kahn Brothers ( 18 ) Kakkanad ( 4 ) Kanyakumari ( 2 ) Kawai ( 2 ) Ken Fisher ( 10 ) Kids ( 49 ) Kids Yamaha ( 3 ) Kindle ( 2 ) Kodaikanal ( 2 ) Korg ( 2 ) Kraft ( 2 ) Kuala Lumpur ( 2 ) Kynikos ( 20 ) LSAT ( 1 ) Larry Robbins ( 18 ) Las Vegas ( 2 ) Leon Cooperman ( 30 ) Leucadia ( 2 ) Leucadia National ( 13 ) Lone Pine Capital ( 9 ) Lou Simpson ( 15 ) MCAT ( 1 ) MFP Investors ( 37 ) MODUS ( 1 ) MSD Capital ( 22 ) Mahabalipuram ( 2 ) Malaysia ( 3 ) Marathon ( 2 ) Mark McGoldrick ( 10 ) Markel ( 24 ) Mason Hawkins ( 4 ) Melinda Gates ( 35 ) Michael Dell ( 22 ) Michael Price ( 40 ) Middle School Education ( 4 ) Middle School Textbooks ( 3 ) Mini Notebook ( 3 ) Mohnish Pabrai ( 22 ) Mount Kellett ( 10 ) Music ( 6 ) Mutual Funds ( 8 ) Nelson Peltz ( 17 ) Netbook ( 4 ) Notebook ( 3 ) O-Duster ( 1 ) Oahu ( 2 ) Ole Andreas Halvorsen ( 10 ) Omega Advisors ( 29 ) Options ( 4 ) PEG ( 2 ) PLAN Test ( 1 ) PSAT ( 1 ) Pabrai Fund ( 17 ) Paulson & Company ( 7 ) Paulson and Company ( 9 ) Pershing Square ( 19 ) Phil Fisher ( 5 ) Philippe Laffont ( 28 ) Piano ( 9 ) Prem Watsa ( 17 ) Property Taxes ( 2 ) R2I ( 24 ) R2I Finances ( 3 ) R2I Housing ( 5 ) RBS Partners ( 19 ) REIT ( 3 ) Raising Kids ( 41 ) Rat Race ( 15 ) Reducing Expenses ( 2 ) Retirement Portfolio ( 9 ) Reviews ( 81 ) Richard C. Blum ( 12 ) Robert Bruce ( 39 ) Robert Karr ( 23 ) Robotic Vacuum ( 4 ) Roland ( 2 ) Roomba ( 10 ) SQ Advisors ( 15 ) Sears ( 12 ) Services - Reviews ( 33 ) Seth Klarman ( 19 ) Shipping ( 5 ) Shopping ( 3 ) Ski ( 5 ) Sled ( 4 ) Solar Stocks ( 13 ) Soros Fund Management ( 14 ) Southeastern Asset Management ( 4 ) Southwest ( 2 ) Stanley Druckenmiller ( 33 ) Statue of Liberty ( 2 ) Stephen Mandel ( 9 ) Stock Analysis ( 84 ) Stock Investments ( 4 ) Stock Portfolio Updates ( 6 ) TOEFL ( 1 ) TPG-Axon ( 20 ) TaxAct ( 3 ) TaxCut ( 1 ) Teacher's Editions ( 5 ) Technology ( 5 ) Test Prep ( 11 ) Thailand ( 3 ) Thekkady ( 2 ) Third Point ( 10 ) Thomas Gayner ( 44 ) Thyra Zerhusen ( 29 ) Tiger Cub ( 34 ) Tiger Global ( 17 ) Tiger Management ( 13 ) Time Square ( 2 ) Travel ( 278 ) Travel Reviews ( 82 ) Trian Fund Holdings ( 10 ) TurboTax ( 3 ) Tweedy Browne ( 10 ) Vacations ( 28 ) ValueAct ( 11 ) ValueAct Holdings ( 8 ) Vancouver ( 2 ) Video ( 3 ) Viking Global ( 10 ) Wallace Weitz ( 18 ) Warren Buffett ( 32 ) Wayanad ( 4 ) Weitz Investment Management ( 17 ) William Von Mueffling ( 12 ) Wintergreen Advisors ( 15 ) YDP ( 1 ) YPG ( 1 ) Yacktman Asset Management ( 10 ) Yale Endowment ( 17 ) Yale University ( 7 ) Yamaha ( 7 ) air asia ( 2 ) airlines ( 2 ) apartments ( 2 ) barbuda ( 2 ) bay area ( 2 ) best sites ( 9 ) books ( 4 ) british honduras ( 2 ) canada ( 4 ) cancun ( 3 ) carl icahn ( 9 ) casino ( 3 ) coin collecting ( 266 ) collectibles ( 266 ) cook islands ( 2 ) coonoor ( 2 ) credai ( 4 ) dry bulk shipping ( 2 ) eReaders ( 2 ) flat ( 4 ) flats ( 2 ) free ( 17 ) frugal ( 3 ) futures ( 2 ) gambling ( 3 ) garmin ( 2 ) george soros ( 27 ) giveaway ( 15 ) gps ( 5 ) hobby ( 17 ) holiday shopping ( 7 ) home ownership ( 5 ) iRobot ( 5 ) india real estate ( 5 ) invesco ( 17 ) investing strategies ( 3 ) israel ( 5 ) kerala real estate ( 5 ) kochi ( 8 ) laptop ( 5 ) long ( 6 ) long call ( 2 ) long puts ( 3 ) memorabilia ( 266 ) mortgage ( 2 ) mysore ( 2 ) numismatics ( 266 ) offers ( 2 ) online tax ( 4 ) ooty ( 2 ) passive income ( 7 ) pattaya ( 2 ) philately ( 283 ) portfolio ( 4 ) product reviews ( 13 ) reading ( 5 ) real estate ( 6 ) schooling ( 2 ) seeking alpha ( 2 ) short ( 5 ) short calls ( 2 ) short put ( 2 ) short puts ( 2 ) short selling ( 13 ) spin-offs ( 2 ) stamp collecting ( 283 ) stocks ( 3 ) summer ( 2 ) tax ( 7 ) theme park ( 2 ) trip report ( 21 ) value investing ( 25 ) wilbur ross ( 17 )