How to Effectively Set Up Your HOA Budget - a person holding a small house cutout

How to Effectively Set Up Your HOA Budget

October 3, 2018 1:16 pm

Every HOA needs to have a proper annual budget. However, it’s important to pay attention to the proper practices when it’s actually time to set up your HOA budget. Otherwise, you may end up with unfortunate and far from ideal solutions in this regard. Keep on reading to learn what you need to do.

 

Check the governing documents

It’s essential that you give a proper look to your governing documents. After all, these contain a detailed description of how to set up your HOA budget. In order for the budget to get adopted, it either has to be accepted by the HOA board, or voted for by homeowners. In some cases, however, it will require both.

 

Keep in mind your reserve studies

Your reserve studies are an important part of the annual HOA budget as they will tell you about the pressing issues in your community. This usually includes details about repairs and updates. Together with information on just how much money there is in the reserve fund, you’ll be able to estimate the budget a lot more precisely.

 

Determine the assessments

This step has to be taken very carefully and analytically as it impacts the homeowners directly. Basically, when you set up your HOA budget for the year, you also need to determine the assessments. This means that you’ll have to decide between the two options: charging all homeowners in the community equally or charging them based on the property percentage.

 

You can negotiate contracts

It’s important that you know and understand that you have every right to negotiate contracts if you don’t think that the first estimate is appropriate for your community.

 

Don’t hesitate to offer saving tips

When setting up a yearly HOA budget, you only want to do the best for your community. In that sense, there’s nothing wrong with offering the homeowners some extra money-saving tips that can help them greatly during the year.

 

Be open and communicative

One of the most important things in any community is complete transparency and proper communication. Therefore, make sure that everyone in the community understands the numbers involved in the annual budget. This also goes for their responsibility together with HOA duties as well.

 

When dealing with the annual HOA budget, you have to be very thorough. Under no circumstances should you rush this process because it can affect your community negatively. For any advice and professional help, don’t hesitate to contact us at Boom Properties.

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