To determine which among the many Myrtle Beach condos for sale is the right investment for you, you will have to learn more about Homeowners’ Association (HOA) fees. It is imperative that you understand how the HOA of the condo you are considering buying calculates and spends the HOA fees. This will help you determine whether or not the condo association is financially stable or not, which will affect the outcome of your investment.
What is included in the HOA fees?
Generally, the HOA fees are spent on the maintenance of the common areas in the condo building. These include the play or game rooms, entertainment rooms, recreation rooms, and landscaping. If you plan to purchase a condo from a gated community, expect higher HOA fees since it will also be used in paying for 24/7 guard service, guard shack facility maintenance – i.e. utilities, water, and AC – street maintenance, patrol car maintenance and electric gate maintenance and operations. In some gated communities, they also use HOA fees to fund reserves for patrol car maintenance.
If there are other maintenance fees that was not included in the HOA fees – such as emergency repairs or replacements – the condo association will conduct a special assessment. This is when all members of the condo association will calculate the additional expenses and decide or vote on a fee, which will be added on top of the current monthly HOA fees. This additional amount will be used to cover the emergency repairs and replacements as well as fund the association’s reserve budget for such unexpected expenses. Once the additional fee is finalized and settled, each owner in the building will be sent a bill detailing the additional fees and the amount they need to settle.
Why are HOA fees increasing?
HOA fees may increase in time depending on the current maintenance expenses it is being allocated for. If the condo association doesn’t have reserve fund for unexpected repairs and replacements, you can almost be sure that its HOA fees frequently increase.
On the other hand, if it does have a reserve fund, it can still increase in time especially if it has used the reserve funds for emergency repairs. They will need put money back in the reserve fund as well as increase the amount they put into the fund to cover emergency repairs.
What you should check when analyzing the HOA fees?
You’ll want to check if the condo association has reserve funds and how much money is left in the fund, if possible. This will guarantee you that the condo association is well equipped to overcome any unexpected weather disturbances or occurrences.
You also want to check how many of the individual condo unit owners are not paying their HOA. If a lot of the condo owners are not paying their association dues, it could mean that the association is not stable, which could mean it wouldn’t be a great investment for your hard-earned money.
Get a copy of the budget and bring it to your CPA or any legal professional that you trust to have a look and confirm your initial assessment. Ensuring you are making the right investment is necessary and critical before you actually make the purchase.
Want more information? Contact Jerry Pinkas Real Estate Experts now.
Jerry Pinkas Real Estate Experts
604 N. 27th Ave
Myrtle Beach, SC 29577
Providing you with professional advice and assistance in choosing which Myrtle Beach condos for sale to buy.