HOA and Management Company

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boogiehead
Posts: 118
Joined: Wed Sep 27, 2017 11:45 pm

HOA and Management Company

Post by boogiehead » Mon Jun 03, 2019 11:09 pm

This past year I received notice that my HOA is increasing by 15%.... I was shocked when I saw the increase, but never got around questioning it. I started looking into the budget and realized there were two line items that seemed extremely high compared to another condo that I own in the same area that are very similar in size.

1) Management Fee - $42,000 (90 units/$38 per month per unit) other unit $26,700 (100 units/22.25 per month per unit). On top of that last week the management assistant accidentally revealed the list of owners of all the units and I realized that the our association manager owns 3 units in my complex and I am pretty sure she has some stake in the management company too. I feel like this is a potential of conflict of interest.

2) Elevator Maintenance - $22,800 the other is $1800 both have 3 elevators.

Can someone maybe with HOA/management company experience chime in to see if I am over thinking this as or are my points valid as I am debating if I should bring this up in the next HOA meeting.

runner3081
Posts: 2572
Joined: Mon Aug 22, 2016 3:22 pm

Re: HOA and Management Company

Post by runner3081 » Mon Jun 03, 2019 11:43 pm

It is not uncommon for people to own more than one unit in an HOA - I see zero issues with that.

As far as, "I am pretty sure she has some stake in the management company too."

Find out for sure before bringing this up.

A 15% increase in itself isn't enough info. What is the history of increases? I am the president of our HOA and we only jump it every few years, so they are bigger jumps, but not as frequent (all evens out).

The management fee, in itself, is hard to gauge without knowing their involvement.

Also, Is that the straight fee, or does that include fines, resale certs, etc (or are those on top?) We pay $19,536 per year for their management fee only for a 201 house neighborhood (zero-lot-line) classified as condos, but all detached. There can be up to another $2k on top of this for other fees (always provided on a line-item basis).

Topic Author
boogiehead
Posts: 118
Joined: Wed Sep 27, 2017 11:45 pm

Re: HOA and Management Company

Post by boogiehead » Wed Jun 05, 2019 3:43 pm

Thanks for your input, wanted to try to clarify a few things.
runner3081 wrote:
Mon Jun 03, 2019 11:43 pm
It is not uncommon for people to own more than one unit in an HOA - I see zero issues with that.

As far as, "I am pretty sure she has some stake in the management company too."

Find out for sure before bringing this up.
My concern isn't that she owns 3 units, my concern is that she is also the HOA property manager, and she has a stake in the HOA management company. I say that because she was the broker that represented the builder when I bought the property and they basically setup this property management company afterwards to run our association.
runner3081 wrote:
Mon Jun 03, 2019 11:43 pm
A 15% increase in itself isn't enough info. What is the history of increases? I am the president of our HOA and we only jump it every few years, so they are bigger jumps, but not as frequent (all evens out).
Good point this is the first increase since I bought the property new about 3.5 years ago.
runner3081 wrote:
Mon Jun 03, 2019 11:43 pm
The management fee, in itself, is hard to gauge without knowing their involvement.

Also, Is that the straight fee, or does that include fines, resale certs, etc (or are those on top?) We pay $19,536 per year for their management fee only for a 201 house neighborhood (zero-lot-line) classified as condos, but all detached. There can be up to another $2k on top of this for other fees (always provided on a line-item basis).
I am not sure about the fees I'll try to look into the budget to see, but as you can see there is a huge discrepancy of only $9 vs $38 per unit per month for the HOA fee.

adamthesmythe
Posts: 3030
Joined: Mon Sep 22, 2014 4:47 pm

Re: HOA and Management Company

Post by adamthesmythe » Thu Jun 06, 2019 10:29 am

The management company works for the board. You (and your neighbors) elect the board. If you (collectively) feel the management fee is to high, you can put the contract out for bid.

If you want to do this, be prepared to get involved.

It seems to me that the association manager has conflicting motivations: keep the management fee low to benefit the units owned and keep it high to benefit the management company.

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