How Much Do HOA Management Companies Charge in Oakland, CA?

How Much Do HOA Management Companies Charge in Oakland, CA?

Homeowner’s Association Management Company Fees

An HOA property management company will generally break their fee into three categories: initiation, ongoing, and exit fees. Typical HOA fees are as follows:
 

HOA Management Fees

Initiation Fees: These fees are charged in order to take over the day-to-day management of the HOA. They will cover bookkeeping, file transferring and review, record transition, banking and software changes. In a small HOA, the fees could total a few thousand dollars. A large HOA which has several hundred homes could see an initiation fee into the tens of thousands of dollars.
 

Ongoing Management Fees: This will be a monthly fee that is stipulated in the contract. The fee is set on an annual basis and an HOA can expect to pay $10 to $20 per unit, per month. The monthly fee will be higher in more exclusive homeowner associations.
 

Exit Fees: Exit fees are charged when one property management company must transfer the reigns to another company. It is sort of a penalty for switching companies but it does, however, help make for a smoother changeover.
 

Homeowner’s association management fees can vary greatly from company to company. The main reason for this is that no homeowner association will be looking for exactly the same services nor is every HOA the same size. This is why the first question to HOA property managers should never be “What do you charge?”
 

Why Would an HOA Hire an HOA Property Manager?

It is sort of a natural assumption to think that a homeowner’s association (HOA) is a property management company. While many homeowner associations manage all of the properties within their planned unit development, the HOA will be made up of individual owners who have volunteered and been elected to the board of directors. They have their own jobs, their own families and a life of their own. Running the HOA is a side project that often gets forgotten or pushed to a back burner.
 

The larger the HOA, the more time, effort, and expenses are needed to manage everything. Homeowner associations are responsible for these tasks:

• Developing and enforcing the covenants, conditions, and restrictions

• Maintaining all common areas including playgrounds, pools, landscaping and snow removal

• Managing association security

• Creating the annual budget

• Setting and collecting dues from property owners

• Obtaining and maintaining property and liability insurance

• Hiring contractors

• Scheduling, arranging and overseeing community activities

When the tasks of the day-to-day management of the homeowner association become a burden for the elected board of directors, they can opt to hire an HOA property manager to handle these tasks.
 

What Do Homeowner Association Property Managers Do?

An HOA property management company can be hired to handle all of the responsibilities that would typically be handled by the HOA. This can include all aspects of the financial and physical management:
 

HOA property management responsibilities

• Enforcing the association by-laws and covenants

• Soliciting and negotiating service contracts

• Hiring and paying contractors, maintenance, and security personnel

• Hiring and training of onsite personnel

• Paying all expenses including common area utilities, property taxes, insurance, and loans

• Maintaining an expense reserve

• Collecting dues from owners

• Obtaining court judgments for owners in default of their dues

• Handling owner complaints

• Maintaining all financial records and bookkeeping

• Communicating with residents

• Handling emergencies

• Assisting owners and real estate agents in the buying and selling of homes within the association

• Executing all decisions made by the board of directors

• Development of a long-term capital improvement/replacement plan

• Ensuring compliance with state and federal requirements for an HOA

HOA property managers can also offer services to individual property owners who do not live permanently within the association. Perhaps they use the property as a summer home and are looking for a company to maintain the property in their absence. Other owners rent out their properties and would prefer the management of their rental to be handled by an onsite PM. While these services are paid by the individual owners and not the HOA, they can be appealing perks offered by the association.
 

How Do You Choose an HOA Management Company?

When choosing a new homeowner association management company, do not focus on the price. Instead, focus on the value of the property management services that the HOA Property Manager will be providing the HOA.
 

Here are some tips when hiring a homeowner association property management company:

• Check the HOA by-laws: Before hiring an HOA Property Manager, make sure there are no explicit prohibitions against hiring a third-party provider to handle the duties of the HOA.

• Create a scope of work: During a board meeting, it would be good to create a list of duties that the Property Manager would be expected to handle. The HOA does not need to hand over all the management unless they deem it necessary. Perhaps the HOA will continue to collect dues and pay the bills but would like the property manager to handle the maintenance, repairs, and owner complaints. Having a written scope of work will help the property management company to set their fee based on a well-defined list of duties.

• Check their experience: When interviewing an HOA property management company, ask for a list of current and past clients and then give them a call. See if those clients would hire the property manager again if they had the chance. Ask the property manager how long they have they been in the business and whether they are licensed.

• Check their coverage: A property management company needs to carry errors and omissions insurance (E&O) which is a type of professional liability insurance that will protect the HOA and the property management company against claims made for inadequate work or negligent actions.

When a homeowner association is interviewing several property management companies, it can help to break the fees down to the cost per unit. Remember that the smaller the number of units, the higher the management cost per unit will be.
 

A homeowner association property manager is an effective way to oversee the management of a large condominium or townhouse project, planned unit development, gated community or subdivision. Their skilled and effective management can go a long way in protecting the value and appeal of the community while reducing the strain on the HOA board of directors.
 

If you are in the Oakland or Bay Area, feel free to contact our Oakland HOA property managers for further assistance. If you are in the Northern California or Sacramento Area, contact us at our Sacramento Office to talk more about your Sacramento HOA Property management needs!

​​​​​​​

​​​​​​​

​​​​​​​

​​​​​​​