Homeowners association (HOA) management is one of the biggest investments you can make for your community. A management company can make the lives of both the board of directors and homeowners easier by taking care of daily operations and overall community management. But what are you supposed to do when your HOA management isn’t working out? If you’re dealing with problematic and inefficient management, it may be time to change HOA management companies. Here’s what you should know before deciding if you need new HOA management.
Do You Need New HOA Management Services?
Check out these signs to watch out for to know if you need to make the switch:
1. Low-Quality Service
If your community is receiving low-quality service, your HOA management may be lacking in experience and expertise. HOA management should have adequate knowledge when it comes to all community matters, especially when it comes to financial and legal matters. Otherwise, they will be prone to errors that your association might become liable for.
2. Poor Communication Skills
Communication is one of the most important duties of HOA management. Your HOA manager is responsible for communicating regularly with the board, homeowners, venders, contractors, and other clients. If HOA management is slow to reply — or doesn’t even respond at all — to emails, calls, and other correspondence, you may want to consider new HOA management.
3. Inability to Complete Projects
HOA management is also in charge of community projects, both big and small. But if your community manager cannot even accomplish simple tasks such as replacing street lights, then that should be a red flag for the board. This may be due to a lack of managerial skills or management just being complacent.
The inability to complete projects can also affect your community’s finances. Capital improvement projects should always be on schedule or else, you may end up spending more than your community can afford.
4. Hidden Costs
The HOA management agreement should clearly outline monthly management fees and all the services included. Your HOA management shouldn’t surprise you with additional fees and charges out of the blue. Hidden costs add up, and they can seriously deplete your community’s funds and resources. This can also lead to a lack of trust between your community and HOA management. If your management company is constantly charging you for services that were initially agreed upon, you may want to start thinking about a new HOA management.
5. Inconsistency or Selective Enforcement
HOA management is responsible for enforcing rules and regulations stated in your community’s bylaws. Inconsistent or selective enforcement is not only unfair to homeowners, but it also means that your management company is not doing their job properly.
An HOA manager should stay on top of compliance situations by conducting routine inspections and sending violation letters properly. Selective enforcement will just open up your community to discrimination lawsuits and other legal troubles.
6. Financial Losses and Reduced Profits
HOA management is supposed to help the board, not create even more problems or issues. HOA management should always be on the lookout for prospective homeowners, but lack of marketing expertise may be a hindrance. Your HOA manager should also be the one to provide sound financial advice to the board. However, if they exercise poor judgment, it may just lead to more fines for the community.
Associations are run like a business, so HOA management should be helping you increase profits. If it’s the other way around, this may be a sign that you need new HOA management.
7. Homeowner Complaints
The overall goal for community management is to make the homeowners happy. If the board is receiving continuous complaints from homeowners, it means that they are dissatisfied with HOA management.
They may complain about maintenance issues such as broken equipment in the clubhouse or problems with trash pickup. Some homeowners might even have disputes with your management company. For this reason alone, you may want to consider making a change to a new HOA management company.
There are many factors to consider when evaluating your current HOA management. First and foremost should be whether HOA management is able to take care of your community’s needs. You should also ask whether your management company is honoring the terms of your HOA management agreement. By analyzing these aspects, you’ll be able to see if you need new HOA management.
8. Board Member Burden
An HOA management company is supposed to make the lives of board members easier. If you find that your job as a board member isn’t any better than before you hired a manager, then it’s time to consider new management.
9. Legal Issues
An HOA management company should provide legal guidance and assistance. If you see an increase in legal issues or disputes for your HOA, then your management company is likely not handling this aspect well. Furthermore, if you’re behind on legal compliance, such as filing important documents on time with state or local agencies, then your management company is definitely lacking.
How to Change HOA Management Company
If you wish to switch out the old for a new HOA management company, here are the steps to follow.
1. Review Management Agreement
Once you have decided to change your HOA management company, the board should consult the HOA management agreement. Check the expiration date of the contract and see if there is an auto-renewal clause. You may choose to wait until the HOA contract expires before switching to new HOA management.
2. Provide Notice
Make sure to provide advanced notice to your current community management company. The number of days will depend on what’s written on your contract, but it’s usually between 30 to 90 days.
If you wish to terminate services immediately, look at your contract’s cancellation policy. The association may still be required to provide adequate notice. There may also be a fee or penalty for canceling the HOA management agreement.
3. Seek Legal Counsel
Consult with your HOA attorney to ensure that this process goes smoothly. The new HOA agreement should also be reviewed by the attorney to ensure that the community is covered from a legal perspective. The board can also consult with homeowners when looking for a new HOA management company.
4. Update Homeowners
Homeowners have a right to know when you’re changing HOA management companies. Let homeowners know by sending out a written notice of the decision. Use other communication channels to disseminate information as well. This way, homeowners know not to engage further with the community manager or anyone affiliated with the old HOA management company.
5. Start Looking
The final step is to start looking for a new HOA management company. It is best to look for a company that fulfills your community’s needs. Since now you have an idea of what you don’t want in a company, you can refine your search better.
Here are some critical tips when looking for a new HOA management company:
- Ask for input and feedback from homeowners. Learn what they liked and disliked about the previous management.
- Send out RFPs to multiple companies. This will cast you a wide net from which you can narrow down a list of viable candidates.
- Interview your candidates. Ask questions relating to fee structure, how they deal with emergencies, communication methods, and anything else you’re concerned about.
- Talk to your HOA lawyer. Ask for advice or a recommendation.
What to Look for in New HOA Management
Associations should be meticulous when looking for a new HOA management company. Take as much time as you need when interviewing candidates, reviewing their proposals, and negotiating terms of the HOA management agreement. You also want to see if there is a problem with HOA management companies that you are considering.
Avoid mistakes from your previous HOA management by making sure that your new community management company is accredited, certified, or licensed. These can be proof of their experience and expertise when it comes to community management.
Some of the qualities to look for in an HOA manager include excellent communication skills, keen attention to detail, strategic thinking skills, a strong work ethic, proactive attitude, and consistency. You may also have specific qualities in mind that would be beneficial to your community.
Revive Your Community with New HOA Management
Having inefficient management that provides subpar services can significantly affect the quality of life in your community. It may be a contributing factor to homeowner dissatisfaction or even homeowner apathy. If you can relate to the signs discussed in this article, it may be time to look for new HOA management.
You want to choose a qualified community management company that can guarantee the safety and well-being of your community. Homeowners, board members, and management should all have a good working relationship to ensure that all community matters are handled properly and effectively.
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- Ensuring Your HOA Is Doing Its Best
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- 5 Top HOA Management Issues Caused By Poor Communication In HOA Community
