How the Right HOA Management Company Transforms Board Efficiency and Decision-Making

The right HOA management company transforms board efficiency and decision making, resulting in a fruitful and strong relationship between the board and the community they oversee. The goal of an HOA management company is to facilitate the cumbersome and time-consuming roles of a board while also providing an added layer of protection to its members. This type of partner can drive significant improvements in both operations and decision making that will help HOA boards be more sustainable and effective in both the short and long term.

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Challenges Faced by HOA Boards Without Professional Support

Without the support of an HOA management company, HOA board members can find their jobs to be far more time-consuming and demanding than they may have anticipated. This additional stress may cause board members to burnout or even resign earlier than they might have had they had the proper support in place from a management company.

In addition to the regular duties of posting meeting notices, holding annual meetings, preparing budget and finance information, holding elections, and more, the absence of a management company adds more administrative and operational duties to their plates. These duties may include but are not limited to:

Maintaining records
Monitoring and enforcing compliance
Collecting dues
Facilitating needed repairs to community equipment and structures
Staying compliant with federal and state laws
Handling conflicts and skepticism from homeowners

Not only will the board have to handle these additional duties, but they may be lacking the proper expertise in legal, financial, and operational realms to do so. This shortfall could put them and their community at unnecessary and serious risk.

Without an HOA management board to be a liaison between the board and those they oversee, such as residents and vendors, it can cause a variety of issues, which are not limited to inefficient communication, limited transparency, and the possibility of some members abusing vendor connections. Comprehensively, it can create a disaster scenario for an HOA board.

Finally, the increased amount of administrative and operational burdens that fall to an HOA without the support of a management company can result in delayed decision-making. This delay could potentially cause serious issues in board meeting deadlines and stipulations set by federal and state laws which may risk punitive measures in return.

How the Right HOA Management Company Enhances Efficiency

There are duties such as administrative relief, technology, vendor management, and meeting facilitation for which an HOA management company can provide much needed efficiency relief for the HOA board.

Administrative relief is one of the areas in which an HOA management company can make the biggest strides in efficiency as they can take over the management of day-to-day tasks such as collecting dues, managing delinquency, preparing budgets, facilitating financial reporting and record keeping, and even coordinating meetings. It is not uncommon for an HOA board without management company support to spend up to sixty hours a month on administrative duties. With the help of a good management company, this number has the potential to substantially decrease.

Another time-consuming area for HOA boards is communication and community relations. An HOA management company can assist with these duties by handling community inquiries and complaints, coordinating neighborhood updates, and even managing an HOA portal or website to increase accessibility to community members.

Document sharing is no longer efficient when handled strictly by snail mail in a digital age. Therefore, an HOA management company can facilitate communication, information sharing, and payment of dues through modern technology such as a website or HOA portal.

When managing and coordinating vendors falls to an HOA management company, it can keep from eating up the valuable time of board members by taking on activities and responsibilities such as:

Soliciting and collecting bids for services such as repairs or landscaping from trusted vendors
Scheduling contractors after board selection and supervising their efforts
Examining shared community areas and managing related service issues

Coordinating and facilitating meetings is also a valuable time saver that HOA management companies can provide. The management company can assist by preparing agendas, keeping meetings on track, and ensuring that there is compliance with the bylaws.

HOA Management Companies Can Improve Boards’ Decision-Making Capabilities

With the sheer amount of decision-making a board is responsible for, there are things an HOA management company can do to help facilitate and streamline the process.

For example, there will likely be situations that a board faces in which a high level of expertise is required in terms of legalities, finances, and property management. A reputable and experienced HOA management company can provide the board access to this level of expertise in a timelier manner.

Decisions are best made when they are centered on facts. To help HOA boards make more solid data-driven decisions, a management company can provide regular reports, statistics, and insights regarding the community’s budget, maintenance, and violations. Having this data at the board’s fingertips allows them to make fact-based decisions more swiftly.

Policy enforcement by a third party is necessary for HOA boards to ensure that it is neutral, legal, and consistent. This neutrality can help limit friction between neighbors. Policy enforcement may take the shape of:

Inspecting community property on a regular basis
Documenting compliance violations (exterior modifications, landscaping, etc.) in logs supplemented with letters and photos
Communicating violations to homeowners along with detailed information on rules broken and how to appeal
Issuing formal violation efforts
Tracking compliance deadlines
Following up with additional deadline reminder notifications
Preparing legal defense in the event of a homeowner challenge
Coordinating homeowner fines and hearings
Assisting HOA attorneys as needed
Maintaining, updating, and amending policy in the name of clarity and transparency

In addition to day-to-day processes, an HOA management company can provide strategic planning insights to the board for long-term vision and success. This typically involves identifying, facilitating, and tracking strategic goals. This can be done through planning sessions, trainings, budget forecasting, reserve planning, capital improvement, community engagement and more. Together, focusing on these areas helps the board think of long-term goals such as sustainability, reserves, and improvements.

The Real-World Impact of an HOA Management Company

For a profile of the real world impact an HOA management company can have on a board, it is worth examining a North Carolina HOA in which 185 single-family homes were originally managed solely by the HOA board.

Challenges the board encountered included:

Inconsistent dues collections
Delayed maintenance
Missing vendor selection and safeguard processes
Underfunded reserve fund
Reactive budget planning (rather than proactive)
Low meeting attendance
Poor community morale

After 18 months of working with an HOA management company, the board reported that delinquency in dues fell by 9%, the reserve fund went from 60% funded to 95% funded, resident meeting attendance increased by up to 50 more people at each meeting, a lower maintenance response time, and a 43% higher satisfaction rate among resident satisfaction.

In summary, the board experienced improvement in each of their original problem areas by simply partnering with a reputable HOA management company.

What to Look for in an HOA Management Company

Knowing you need an HOA management company and then figuring out what to look for in one are two entirely different things. The latter requires action. Some vital considerations to keep in mind when shopping for the right management company for your HOA board can be choosing a company that has the following:

A proven track record and strong references. Having each of these elements helps cut down on the amount of research and vetting an HOA board needs to do.
Transparent fee structure. In other words, it should be completely obvious what fees are included rather than residents questioning hidden fees.
Tech forward solution. We live in a digital world that can make communication more efficient through technological advances such as email, websites, and resident portals.
Around the clock response for resident support. This means being available when needed so that necessary action is taken in a timely manner.
Customizable service packages. This type of arrangement allows a board to select only the services they need, making it more budget friendly.

There can be a transformation in processes and efficiency with the right HOA management company as your partner. See the difference for yourself by having your HOA board evaluate their current management solutions, identify areas a management company could help with, and determine what difference that might make. If you have questions, reach out to a reputable HOA management company today for consultation.