Condo association vs HOA comparisons often confuse buyers, owners, and even board members who assume the two operate the same way. While both govern shared communities and enforce rules, they differ in several meaningful ways. It is important to understand these distinctions to set expectations and help the board manage its duties more effectively.
Condo Association vs HOA: Planned Developments
Planned developments come in a variety of forms; among the most popular are condo associations and HOAs. Understanding the similarities and differences between these two is crucial to both owners and board members.
For buyers and owners, it helps them decide which one suits their financial capacity and lifestyle better. It also clarifies their own obligations towards the association. For board members, it clearly defines their roles and responsibilities within the community. By understanding how their association works, they can tailor their solutions and management approach.
What is a Condominium Homeowner Association?
A condominium owners’ association (COA) is a community in which owners hold title to individual units. These units are attached to one another, sharing walls, floors, and ceilings within a building. The COA retains ownership and control over the common elements. These usually include roofs, exterior walls, hallways, elevators, and shared amenities.
The role of the condominium HOA board is to oversee maintenance, financial management, and rule enforcement. Since units share many common elements, the board’s responsibilities largely focus on their maintenance and operation. Unit owners have their own obligations, paying dues and maintaining the interiors of their units.
What is a Homeowners Association?
A homeowners association (HOA) is a community wherein owners hold the title to individual properties. Typically, these are single-family detached homes, but they can also include attached townhomes. In this setup, homeowners own the land and the structure on top of it. Meanwhile, the HOA is responsible for managing and maintaining shared spaces, such as pools, clubhouses, private roads, and landscaped areas.
The role of the HOA board is similar to that of the COA board. Board members oversee maintenance, financial management, and rule enforcement. That said, HOAs often focus more on rule compliance, finances, and upholding community standards, since there are fewer shared elements between homes (or none at all). Individual owners must maintain their own homes, adhere to the architectural guidelines, and pay dues.
Is a Condo Association the Same as an HOA?
Since they both follow association governance, many wonder, “Is an HOA the same as a condo association?” The answer is a simple no. While they share some similarities, COAs and HOAs are entirely different communities. They differ in structure, ownership, fees, and maintenance responsibility, among other things.
Condo Association vs Homeowners Association: Understanding the Similarities
Condo associations and HOAs are not completely distinct. They do share some similarities. For one thing, both of these associations exist to manage shared living environments. Each one operates under a set of governing documents, including the CC&Rs, bylaws, and rules.
Both communities are also governed by a board of directors, consisting of volunteer owners elected by other owners. These directors have a fiduciary duty to act within the best interest of their community, regardless of whether it’s an HOA or a COA.
The basic financial setup is also similar. Owners must pay association dues, which fund the community’s expenses. Dues cover everything from maintenance costs and insurance to management fees and reserves. Both types of associations also hire vendors, manage contracts, and work with professionals.
HOA vs Condo Association: Understanding the Differences
While HOAs and COAs share basic similarities, their distinctions run much deeper. Here are the ways these two communities differ.
- Ownership. In an HOA, owners own individual properties, typically separated or detached from one another. In a COA, owners own individual units attached to each other and to the building structure. These units share roofs, walls, and hallways, among other things.
- Maintenance Responsibility. The HOA usually maintains only the common areas, while the COA’s responsibilities extend to building components and shared systems.
- Insurance. Condo associations often carry master policies that cover the building structure and common elements. On the other hand, HOAs insure only the common areas, with homeowners obtaining their own policies for their individual homes.
- Contents of Governing Documents. While both HOAs and COAs have governing documents, their contents can differ. Condo documents usually describe the unit boundaries and common elements in more detail. For HOAs, these documents tend to focus more on land use, exterior appearance, and architectural standards.
- Reserves. Condo associations often require a larger reserve fund because there are more common elements to replace or repair (e.g., elevators, roofs, mechanical systems). While HOAs also need reserves, the amount would depend on the types and number of shared areas and amenities they maintain.
- Governing Laws. In DC, only condominiums have a dedicated statute governing operations (DC Code Chapter 19). As of writing, DC has yet to pass an HOA Act.
What is the Difference Between HOA and Condo Fees?
Both HOAs and COAs collect regular fees from owners. That said, when it comes to HOA vs condo fees, what they cover and how much they cost can vary widely.
Condo fees tend to be higher than their HOA counterparts. This is because condo communities must cover additional expenses, including the cost of maintaining buildings, roofs, elevators, and shared systems. Additionally, reserve contributions, which stem from condo fees, are higher due to condominiums’ more extensive needs.
Homeowners in HOAs can expect lower fees, at least in comparison to condo associations. Since HOAs are only responsible for common areas and amenities, maintenance and insurance expenses aren’t as expensive. Still, if an HOA has many or large amenities, maintenance costs will reflect them as well. Furthermore, fees can rise when major repairs are necessary.
Condo Association vs HOA: Which One is Better?
There is no universal answer to whether one is better than the other. Choosing between an HOA and a COA will ultimately depend on the buyer’s lifestyle preferences. Condo living is often appealing to those who want fewer direct maintenance responsibilities. On the other hand, HOA communities may be better suited to those who prefer more control over their property.
Cost expectations must also be considered. Condos usually charge higher monthly fees due to the nature and structure of their developments. Meanwhile, HOAs may offer lower fees than condos, but owners must pay for individual maintenance.
Similar Yet Different
The discourse surrounding condo associations vs. HOAs is never-ending. Both options have benefits, but they don’t appeal to everyone equally. Buyers must decide based on personal preference, whereas board members must adjust their management approach to meet the community’s needs.
TNWLC offers both HOA management services and condo management services to communities in Washington, DC. Call us today at (202) 483-8282 or contact us online to get started!
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