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Considering Self-Managing Your Community Association? Ask These Questions First
Self-management is a popular approach for many community associations because homeowners maintain complete control over all association decisions – although doing so comes with a few things to consider first. For self-management to work, associations must conduct a performance audit from time to time, and take several things into consideration such as workload and operational capacity. Here are some important questions you may want to ask yourself prior to considering self-managing a community association.
Are you regularly monitoring your financial records?
Financial records are a core part of any association, whether it’s self-managed or not. Financial documents help provide a clear view of the status of your community, as well as serve as the basis for most HOA decisions.
It’s important for self-managed associations to be efficient and consistent in keeping financial records. You need to keep track of all the money coming in and out of the association, and create and analyze monthly financial statements.
Unfortunately, financial reporting, accounting and bookkeeping can be time-consuming and tedious, and many board members may not have adequate expertise to handle the intricacies of financial management. If you want your self-managed HOA to be successful, make sure there is proper and regular financial management – whether it’s finding community members with financial expertise or outsourcing to a third-party service provider.
Can potential board members handle the new workload?
Self-managed associations work well in smaller communities, but as the community becomes larger, the responsibilities grow. The added workload can sometimes be too much for HOA board members to handle on their own, which can lead to inefficient and poorly run operations.
Overworked board members may start leaving their positions; if there is no one else willing to step up, the association cannot continue to operate. Some good options if this begins happening are to invest in and utilize a high quality HOA software; hire an office staff; and outsource a few positions, such as finance management.
Are you addressing the needs of residents?
Addressing the needs of your community’s residents is an essential part of keeping the association running smoothly. If conflicts arise and are not addressed, they may escalate and lead to litigation or excessive fines. This is not only costly for both parties, but it can also do a lot of damage to the overall feeling of community spirit.
When residents aren’t happy it becomes much harder to manage a community association. Board members cannot be effective if their audience is not willing to participate, which is why it’s important to have an advocate for the residents. You may want to consider designating a third party who can advocate for the residents and deal with the HOA board in a more impartial way.
Are there enough qualified members willing to be a part of the board?
All homeowners want the best for the community, but not everyone has the time to volunteer as a board member. In fact, if there are not enough qualified people who can volunteer, self-managing the HOA will become challenging. It’s also good to have involved community members who are willing to join HOA committees or provide assistance to the board.
When choosing who best to manage the community, consider members who are passionate, have the time and are more than willing to perform essential duties for the association.
If you’re currently self-managing your community and feel it might be time to turn to a professional HOA manager, Associated Professional Services can help. Take a look at our services or contact us to request a proposal.