Should you live in a neighborhood with an HOA?

The Triangle area has many neighborhoods that have homeowner associations (HOAs).  The big question is whether it is smart to live in one of these neighborhoods.

If you’re looking for homes in the Raleigh or in any of the neighboring towns of Cary, Morrisville, Durham, Apex, Clayton, Garner, Holly Springs, Fuquay-Varina or Willow Spring, then you will surely run into communities with neighborhood HOAs.  They’re actually very common in our area.

Since most Triangle homes are located in HOA neighborhoods it is important to understand the role of the HOA, and what a resident can expect when they live in a community that has this type of governing association.

What is a Homeowner’s Association or HOA?

HOA stands for “Home Owners Association.” HOAs and restrictive covenants go hand in hand.  Restrictive covenants are the legal rules for the community.  A homeowner’s association is a group of people who work to make sure that the rules are followed.

If you hear restrictive covenants and/or HOA or Homeowner’s association you should be aware that there are rules to the community, that there’s a governing body that makes sure the rules are followed, and that homeowners will pay toward the upkeep of the community.

How are HOAs set up?

When developers create neighborhoods they have a vision for how the neighborhood will look.  The plans for the neighborhood are recorded with the town or the county, and in most cases, a restrictive covenants amendment will be placed on the neighborhood.

The restrictive covenants say what can and cannot happen in the neighborhood.  The developer or the builders will be the first people to regulate that the rules are being followed.  The purpose of restrictive covenants and HOAs is to make sure that standards are adhered to.

Why put rules on the community?

Just imagine if the developer was creating a development of forty (40)  houses.  After 15 sales, the people who bought house five (5) decide that they want to paint their house bright purple and keep old cars and chickens in their front yard?  Yikes!

Obviously, the ugly house would interfere with sales going forward.  This is where these rules and regulations come in handy.  Restrictive covenants help regulate things so that that the neighborhood will not go downhill during the building time.

Builders are taking a major risk when they decide to build a community.  They need some guarantees that the neighborhood will be appealing to buyers.  The builders want to make money, not lose all their investment.

The HOA standards for homes

When you buy in a neighborhood with an HOA you are agreeing to adhere to the rules of the community.  The restrictive covenants of the neighborhood are part of the property because the home is within a particular neighborhood.  The rules can’t be ignored as they’re legal and binding.  If you want to “do your own thing” and build a home as you want it, you’ll have to buy in an area without an HOA.

Restrictive covenants will often specify the size of structures that may be built,  the height and type of fence at a property, the type of mailbox used, exterior paint colors, landscaping issues, what sort of vehicles can be near parked along the streets, etc.

I’ve seen restrictive covenants that are short and have minimal rules.  I’ve also seen a few that was voluminous with strict rules about all kinds of things.  One HOA even regulated the number of pets a home could have.   This might seem to be a far-ranging example, but the truth is that an HOA can regulate almost anything, as long as it isn’t illegal.  That’s why it is so important that you read and understand the covenants and restrictions for the community before you buy.

Why would an HOA want to set so many regulations?

Restrictive covenants will help maintain property values throughout the entire neighborhood by preventing homeowners from doing things such as painting a house an offensive color, flying an obscene banner, or leaving rusting appliances in the front yard.

The houses with the rusty car and mismatched paint will definitely bring down property values.   That house’s resale value would fall because the house wasn’t taken care off.  Gradually though the ugly home will affect the overall feel of the neighborhood and that will affect everyone’s home value.

Pretty homes sell for more money and pretty neighborhoods are always preferred.  One bad apple can ruin the marketability of the whole neighborhood.

The overall beauty of the neighborhood is important for HOAs

Restrictive covenants frequently have rules to address the style and look of homes within the neighborhood.  The rules may create limits on the size of the home, exterior color choices, fences, and other aesthetic qualities.

If you are in a community that has an HOA then you will need to contact the association before you add a fence or paint your house  The association will need to review your plans and give approval.  Again, the purpose is to avoid having eyesores and to maintain home values.

HOA neighborhoods have rules

Well managed HOAs may protect home values

If your home is on the market and the neighboring property is not well maintained you will have problems.  Many buyers will drop your house from the list of properties they are considering.  If they do decide to put in an offer they may ask for a hefty discount because the neighbor’s house is an eyesore.  It’s rare to see buyers ignore that issue.

If you are in a neighborhood with rules and guidelines this shouldn’t occur.  Especially if there is a strong homeowner’s association who are diligent about making sure that the whole neighborhood is aesthetically pleasing.

When do the HOA fees start?

When a neighborhood is completely built up, and sometimes before, members of the association will set an HOA budget for the neighborhood.  If you buy in the neighborhood you are agreeing to pay for these fees. The fee structure and what the fee covers will be explained to you before you buy.

The HOA fees are used for upkeep or maintenance of the shared property, neighborhood signs,  maintenance of community pools, and other items.  Obviously, neighborhoods with more amenities may also have higher HOA fees.  If you buy a home in a community with an HOA assume you’ll pay the fees from the start.

How are HOAs managed over the long term?

When the developer has sold enough homes in the neighborhood, the HOA is transferred to the actual homeowners and the developer moves on to build another neighborhood.

Homeowners in the community will elect representatives to the HOA board.  These committee members will monitor the community to make sure that the rules are respected.   They also figure out if new regulations are needed, they hire people to do work for the neighborhood, and they may create new rules and regulations if needed.  Homeowners can vote on changes to the restrictive covenants.   If any major change is proposed then it will be voted on by the neighborhood residents.

Know the rules before you buy

It is important to carefully read the restrictive covenants before you purchase your new home. When it’s time to work on the house, you will need to make sure that the improvements fit in the guidelines.  To do this, you’ll need to submit the plans to the HOA association and have them review everything before you start your project.  You may have to repaint or take down that chain link fence if the architectural committee has not approved it.  Of course, fines and other headaches will also occur if you fail to follow the rules.

What sort of benefits can an HOA provide for me?

Exactly how much your HOA provides varies from neighborhood to neighborhood. If you live in a townhouse or condominium community, the HOA  will most likely provide landscaping and maintenance of common areas. HOA fees are also used to provide recreational areas such as playgrounds, swimming pools, tennis courts and maybe even a community center or insurance.

Neighborhoods with strong HOAs and reasonable fee structures will frequently experience higher resale values because the neighborhood looks very appealing.  As you see, one of the main goals of the HOA is to ensure that the neighborhood looks nice.

What happens if you fail to abide by the neighborhood HOA rules?

The restrictive covenants can be enforced through fines and liens.  If you live in an HOA neighborhood and forget to mow your lawn, you will probably be hearing from the HOA with a request to get the lawn mowed.  If you fail to mow it, they will mow it for you and bill you back for the landscaping expense.

Here’s a link to some a and their legal encyclopedia.  It is a legal blog that talks about this in more detail.

Your Realtor can help you figure out if a neighborhood is a good fit for your needs

If you decide to buy in a community that has an HOA, talk to your Realtor about the fees, and what services are covered for those fees.  Ask if these fees seem average or a little too high.

Some neighborhoods with very restrictive HOAs and those with high fees may not be a great option for property appreciation.  If you buy a property in these neighborhoods you might run into some trouble when you sell. Higher fees and too many restrictions can cause homes to linger on the market.

Not all HOAs are alike.  So, make sure to compare services, costs and how well the neighborhood sells before you buy.

What if I don’t pay the HOA fees?

If you live in a neighborhood that has an HOA, you are required to pay the fees. Failure to pay could result in liens or fines at the least.  Keep up with those fees and add them to your budget. Also, remember to ask if there are any discounts for early or bulk payments.  Some HOA communities will allow a discount for paying your fees for the whole year instead of on a monthly basis.

I don’t want to live under rules, can I find a Triangle area neighborhood without restrictive covenants or HOAs?

Thankfully, most homeowner associations in our area are reasonably priced and not too restrictive.  There’s plenty of choices for neighborhoods so most people are able to express their individuality even within the rules of a neighborhood.   HOA neighborhoods can actually be helpful because they provide a well-maintained community so don’t rule them all out.  Remember, the majority of the neighborhoods have this type of setup.

All that being said if you are really not interested in living in the HOA type neighborhood that is fine.  It’s possible to find neighborhoods in the Triangle area that do not have a Homeowner’s Association. Just let your Realtor know that you’d prefer to avoid an HOA, and they’ll work with you to find a good fit for what you want.  If you prefer older homes then you should be in luck because most older homes are in areas that do not have restrictions or HOAs.

What should I look out for when buying in an HOA neighborhood?

We have created a list of 11 important questions to ask before you buy in an HOA neighborhood.  The questions will allow you to review the history or the HOA and the neighborhood.  Take a few minutes to check it out.

Hire a buyer’s agent to help you figure out information about homes and neighborhoods

There are lots of great reasons to hire a buyer’s agent to help you figure out the market.   Realtors have extensive knowledge of neighborhoods.  They know how things like homeowner associations and restrictive covenants work.

Check out this link to learn more about the other reasons to hire a buyer’s agent.  If you’re are looking for an agent don’t forget to give Triangle Trusted Realty a call at (919) 481-4914 or send us a note with the contact form at the end of this article.  We’d be happy to help.

We are happy to chat with you about life in the Triangle area real estate market.   Reach out if you want more information about neighborhoods or HOAs in the Triangle area.  You can reach us at (919) 481-4914 or contact us by sending the form below:






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