When Is the Right Time to Raise HOA Fees?

Updated March 8, 2022

When community associations decide on community fee changes, homeowners association fees can become a very hot topic. Not only is it important as a board member to consider the processes and procedures of the community association, but boards must also consider communicating those decisions to community members in an effective manner.

When is the right time to raise HOA fees? Chances are, your community has experienced enough changes lately that you're noticing higher prices for services and other aspects of effective community management--with potential budget challenges, too. Our community management experts have some insights for you today!

Why HOA Fees Can't Stay the Same Forever

If it's been a while since you've had homeowners association board meetings to review recurring homeowner dues compared to current costs and budgeting, it's time to do it soon. It's common for associations to adjust fees to meet changing community needs, rising costs, or repairs or improvements needed for common areas and amenities. However, raising the rate isn't always met with unanimous support from residents. 

If homeowners associations board members have a fear of upsetting homeowners, consider the costs of maintaining stagnant rates when costs for the services you provide to the community continue to rise. Hiring contractors, landscapers, property managers, a lawyer, and an accountant for the HOA are necessary expenses. The annual budget must be able to keep up with changes in those costs to maintain these services. When fees can't cover line items in the budget, your community services suffer, and residents begin to leave. 

In most cases, members of homeowners associations understand that fees can change the longer they live in the neighborhood. Therefore, the possibility of fee changes must also be made clear in new resident paperwork and governing documents for homeowners moving into the community for the first time.

When Should Fees Increase?

In order to have community members understand exactly what HOA fees cover and what they are being charged for and why the community association fees need to be adjusted, there needs to be clear communication and transparency put into effect throughout the process of setting fee amounts and collection.

When considering HOA increases, having a full understanding of all costs for maintaining the community is necessary before presenting information about adjustments. Having accurate numbers will help with community education and ease any tension if your homeowners want more details on how their money is being spent. When your board members are well prepared, HOA meetings about fee changes go smoother!

If you have a larger community with lots of amenities and common areas where costs need to be spread out amongst residents, starting small with increases over time (instead of large jumps) might help ease the tension around these types of fee changes. In some cases, this incremental approach can even lower rates for homeowners if they pay in installments over multiple years rather than one lump sum payment each year. To determine which method works best for your community, seek advice from a professional community management company that can guide you through the right approach to adjusting fees and communicating with residents. 

Changes Justify Higher Fees

Whether it's a result of higher costs for services your homeowners depend on and enjoy or a new project that the community voted to enhance the neighborhood, changes justify higher fees. Homeowners association boards prioritize the health, safety, and well-being of the community. If keeping HOA dues at the same rate no longer provides the budget needed to accomplish these priorities, it's time to raise the amount per homeowner. 

What Happens When Homeowners Complain?

As community managers, we understand that condo association boards frequently hear from community members who believe it may be unnecessary to increase fees, no matter the changes in the community, costs of services, or new projects. Handling these complaints can be frustrating when your board's goal is to simply care for the community to expectations and manage the budget.

However, with a strong community association that is well-organized and transparent with financial information, community fee changes can happen as needed or desired by homeowners to maintain the community. If you're not sure how to present a fee change to residents or deal with complaints, a professional community management company can help. They can help you present changes to homeowners in a way that generates community buy-in while maintaining healthy relationships among neighbors.

Your HOA Board Can Raise Community Association Fees With Community Management Support

Serving on a community association board is a tough job! We know it's tough to make a case for increasing HOA fees, but it's necessary when your budget no longer covers everything under the current rate structure. If you can't afford to keep up with all of your community amenities and meet resident needs without increasing dues, then now is the time to act. 

Work with a reputable association management company like Trestle Community Management by hiring us as consultants or choosing our team as your management company so that we can help you prepare documentation, logistics, and even public relations materials to show homeowners why a fee increase is necessary. Reach out soon! We're here to help.