Different Types of HOAs

Alternatively referred to as community associations, homeowner’s associations (HOAs) can often be found in residential communities. In fact, homeowner’s associations have become increasingly common in recent years. The Community Association Institute reports that about a quarter of (about 70 million) Americans live in some form of a community association. Given the growing popularity of community associations, it is important that homeowners understand what belonging to a community association entails.

HOAs have rules and procedures that their members must follow in exchange for a clean and cohesive environment. They may also provide residents with amenities that they couldn’t realistically have on their own through the collection of dues. The basic framework of a homeowner’s association is similar to that of society at large; residents give up some freedoms, for instance being able to paint their home purple, and get certain services and amenities in return. Although HOAs tend to be similar in many ways, they can differ substantially.

Homeowner’s Association (HOAs)

HOAs are the most common and well-known type of community association. In an HOA structure, a homeowner purchases a plot of land and owns that land. When a buyer purchases property within an HOA, they automatically become a member of the HOA. The surrounding common areas are owned by the HOA, but residents are responsible for the upkeep.

HOA boards are made up of residents who ran and won an election among the homeowners; they are typically unpaid positions. Revenue is generated from HOA dues and it usually covers landscaping, trash removal, sidewalks, etc. Larger communities with more amenities have higher dues.

The HOA also functions to maintain the overall aesthetic of the community. Typically, HOAs have control over the exterior of homes — paint colors, trees, etc. — but less control over interiors.

Condo Association

In a condo association, owners own everything within the walls of their personal unit. They are responsible for maintaining everything within those walls, but they are not responsible for main pipes, wiring, etc. outside of those walls in common areas. Other common elements, like hallways, sidewalks, and recreational spaces, fall out of the residents’ individual responsibility too.

Condo associations elect board members just like HOAs. The board governs the maintenance and servicing of condos, sets and enforces rules, and determines condo fees. Compared to an HOA, condo associations have more power over how residents live. Unlike homes, condos are close together and issues of personal behavior, like noise, are more of a problem.

Civic Association

Civic associations are a group of engaged community members organized in a casual way. They do not have dues, nor can they enforce rules. They generally exist in communities without a functioning HOA. Civic associations focus on advocating for the area in which they live — not regulating residential behaviors. They typically express concerns over community changes, like construction projects or roads, to local governments.

Co-Op, or Housing Cooperative

By buying into a housing cooperative, you are not purchasing a specific unit. You buy into the co-op itself and your unit is your share of the building that you own. Co-Ops have the ability to be more restrictive about who can buy in, so long as they abide by the Fair Housing Act. Like condos, there are common areas that residents are expected to help maintain via monthly maintenance fees. The fees are proportional to the size of a resident’s unit.

Master Association

A master association is an umbrella organization that exists over multiple other associations. Individual homeowners do not pay directly into the master association; each individual association instead funnels funds and a representation into the master association. Their authority depends on the area in which they serve. 

The Bottom Line

There are several different types of community associations and determining which is best can be tricky. Ultimately, it comes down to having a solid grasp of what each type of community requires of its residents and offers in return. This guide from the Community Association Institute can help prospective homeowners make a decision.