There are more than 351,000 homeowners associations in the United States. Each year, these associations must create a budget that is workable and allows them to meet the needs of its resident members.
How can your HOA establish a plan that enables it to cover expenses and plan for the future?
Read on to learn how your HOA board members can establish financial best practices to keep your organization running efficiently each year.
Consider Your Needs
Building financials that work for your HOA require members to consider your needs now and in the future.
For many HOAs, creating a budget revolves around the dues being charged to each resident and the different services offered to the members. HOAs often handle covering expenses such as exterior insurance, lawn care, and painting.
Bigger issues such as paving and roof replacement are expensive projects that require an HOA to budget properly to avoid a high assessment of each of its member-owners.
Budgeting your expenses for one year, two years, and ten years will give your HOA a realistic look at what it will take to accomplish its goals.
Choose the Best Property Managers
Many HOAs choose to hire a property manager instead of trying to handle management activities on their own.
Property managers and HOAs will work together to decide the best way for the HOA to maximize the benefit of a property manager’s services. This includes services like dues collection, soliciting bids on projects, and more.
As you prepare your HOA financials, consider the costs of property managers versus the time and cost the HOA will incur trying to handle all management tasks on its own.
Look Toward the Future
Looking toward the future will help you to prepare financials that are realistic and the most beneficial for your residents.
Your financial projections can’t be too short-sighted and must include accurate information. Otherwise, your HOA is at risk of falling short of having the cash flows it needs to operate.
Establish Financial Best Practices
The most successful financial best practices are the ones that benefit your HOA today and into the future.
By taking the time to speak to your members and listen to their ideas, you will be in a better position to identify HOA needs and how to pay for them.
Are you interested in learning other helpful tips to put to use in your HOA? At Hales Property Management, we are your Chicago condo service professionals!
Contact us today to learn more about our services and how we can help your HOA!