- Community Associations
- Wisconsin, Indiana, Illinois, Florida
Purchasing a home within a condominium, homeowner (HOA), or townhome community association offers numerous benefits from maintained common areas to shared amenities. However, it’s essential to understand the responsibilities and restrictions that come with association living.
Board members should also be aware what potential buyers are evaluating – such as financial health, maintenance practices, rules, and overall appearance – when considering a home that is part of an association.
Here are five key areas that prospective buyers commonly assess or inquire about when evaluating whether a community is the right fit.
- Evaluating the Community Association’s Assessments and Fees
Association fees can vary widely depending on the community’s size, location, amenities, and level of services provided. Prospective buyers will want to know exactly what these fees cover—such as landscaping, security, maintenance, or access to recreational facilities—to evaluate whether the costs align with their lifestyle and expectations.
They’ll also want clarity on how and when these fees are paid, whether monthly, quarterly, or annually. In addition, many buyers will ask about the association’s history of fee increases to gauge potential future expenses and overall financial stability.
Board members should be prepared to communicate this information transparently, as it can significantly influence a buyer’s decision to move forward with a purchase.
- Reviewing the Community’s Rules and Restrictions
Most community associations have rules in place to preserve the appearance, safety, and overall harmony of the neighborhood. These guidelines can cover architectural standards from exterior paint colors, permitted roofing materials, and fence styles. Associations also typically have policies that address parking regulations, pet policies, rental restrictions, and holiday decorations.
Prospective buyers may ask to review these rules carefully to ensure they align with their preferences. Board members should be ready to provide clear and accessible copies of these rules and regulations as potential residents often consider them a deciding factor when evaluating a community association.
- Understanding the Community Association’s Governing Documents
Before purchasing a home in an association, buyers will generally request the governing documents including the declaration (or CC&Rs), bylaws, and any published rules and regulations. The governing documents outline the community’s legal structure and set expectations for everything from property modifications and landscaping requirements to leasing restrictions and noise policies.
In many cases, requesting and reviewing these documents is not only recommended as it may be required by mortgage lenders as part of the underwriting process to confirm that the association is financially stable and well-governed. Board members should ensure these documents are readily available and up to date, as they are often requested during the due diligence process.
- Assessing the Financial Health of the Community Association
A community association’s financial condition plays a key role in long-term property value and owner satisfaction. Prospective buyers may request to review recent financial statements, annual budgets, and reserve fund disclosures.
A strong reserve fund signals that the association is prepared for future capital repairs or replacements, reducing the risk of surprise special assessments. Conversely, limited reserves or inconsistent budgeting may raise concerns about financial management.
- Investigating How Disputes Are Resolved
Disagreements can arise in any shared community, whether between neighbors or with the board. Buyers may want to know how the association handles conflict resolution and enforcement issues. A transparent, fair, and documented dispute resolution process reflects responsible governance and promotes community harmony.
Board members should be familiar with the association’s enforcement procedures, hearing processes, and any available avenues for mediation or appeals, as these can be critical in maintaining trust and accountability within the community.
Legal Resource
For most homebuyers, their home is their largest asset. Accordingly, purchasing property within a community association is a significant decision. In addition to reviewing documents and disclosures, potential buyers may choose to attend a board meeting to better understand the association’s operations, leadership approach, and level of community engagement. They may also speak with current residents to gain firsthand insight into the community’s strengths and any potential challenges, offering a more complete picture beyond what’s found in documents and meetings.
That’s why it’s essential for board members, property managers, and community leaders to be proactive in maintaining up-to-date records, rules, and financial information, and to be prepared to share them upon request. By doing so, you help present your community as transparent, well-managed, and welcoming to prospective homeowners.
Questions about your community association’s governing documents, updating rules, potential buyer requests, or other legal issues? Do not hesitate to call 855-537-0500 or visit www.ksnlaw.com.
Since 1983, KSN has been a legal resource for condominium, homeowner, and townhome associations. Additionally, we represent clients in real estate transactions, collections, landlord/tenant issues, and property tax appeals. We represent thousands of clients and community associations throughout the US with offices in several states including Florida, Illinois, Indiana, and Wisconsin.
Please note the material contained in this article is for educational and informational purposes only and does not constitute legal advice. No attorney-client relationship is established by your review or receipt of the information contained in this article. You should not act on the information discussed in this article without first obtaining legal advice from an attorney duly licensed to practice law in your State. While KSN has made every effort to include up-to-date information in this article, the law can change quickly. Accordingly, please understand that the information discussed in this article may not yet reflect the most recent legal developments. Material is not guaranteed to be correct, complete, or up to date. KSN reserves the right to revise or update the information and statements of law discussed in the article, law at any time, without notice, and disclaims any liability for your use of information or statements of law discussed on the article, or the accessibility of the article generally. This article may be considered advertising in some jurisdictions under applicable law/s and/or ethical rules/regulations. © 2026 Kovitz Shifrin Nesbit, A Professional Corporation.
