February 7th, 2014 1:23 PM by AJ Gentry
We get asked a lot of questions on monthly home owner association (HOA) dues concerning condos and lofts in Kansas City so we thought we would write a short blog post on the subject that affect several, but not all, condo and loft communities.
Maintenance free condo and loft communities (when we say community, we mean that condo/loft community/building) require home owners to pay monthly HOA dues. The dues on several, but not all, condo and loft communities from the River Market south to the Country Club Plaza cover HOA management fees, snow removal, building exterior maintenance, common area maintenance, lawn maintenance, any amenities, water and sewer. Some communities will include various other items you pay through your monthly HOA dues including gas, insurance and parking space maintenance.
When we say amenities we mean features such as a pool, exercise room, extra storage area outside the condo/loft, putting green, club room, theatre room, valet, etc. The more amenities you have the more your monthly HOA dues will be. We encourage buyers to create a list of amenities that they will use and then look for communities that offer those amenities. For instance, if you would utilize an exercise room and cancel your gym membership, find a community that offers an exercise room. However, if you would not use an exercise room (or pool, etc) do not look at communities that include these amenities. You don't want to pay for amenities you won't use. Some people also want secured communities which might increase your HOA dues.
How do communities come up with the monthly HOA due amount? Some communities will look at a yearly budget to operate the community. Then, take that total amount and divide it by the privately owned square feet in a community and come to a square feet cost. The more square feet you own in a community the higher your dues. For example, if a community decides it needs to collect $.20 per s/q and your condo is 1,000 square feet, your monthly HOA dues will be $200. If your neighbors condo across the hall is 2,000 square feet, they will pay $400 for monthly HOA dues. Again, this applies to some, not all, condo and loft communities.
For parking, some communities come with deeded parking spaces. This is where the parking space are sold with the condo and are factored into the sale price. There would not be a monthly fee for parking in these instances. Other communities offer parking spaces that are rented or leased. A rented covered parking space could go for around $85 per month downtown KC and this amount is in addition to your monthly HOA dues in most cases. This is always a question to ask when viewing properties with your Accredited Buyer Representative/REALTOR (US!).
The last question we tend to get is, are HOA dues negotiable. The answer is no. The HOA Board, which is compiled of an elected group of homeowners, along with the HOA management company set a yearly budget each year and operates off of that budget. HOA dues can go up or down yearly but we tend to not see them go down often. You will always want to obtain a copy of the most recent budget in a community and ensure the HOA is running well in the black. Some condo communities are getting close to being in the red = insert a special assessment or raise in monthly HOA dues. You want to avoid this. In MO, a HOA management company has to complete a MO Condo Resale Certificate before a home owner can sell a condo or loft. This certificate will state if the HOA forecasts any increase in dues or special assessments in the next 2 years. When the seller is a developer, they do not have to fill out this form.
For more information on homes with HOA dues, please see this brochure: Download COMMUNITY MATTERS. Questions? We are here to help!
**This information applies to several condo and loft communities we know in Kansas City. However, each community is different. Be sure to ask your buyers agent about each as there are not set rules for HOA dues.**