Homeowners Association Fee - HOA Fee


DEFINITION of 'Homeowners Association Fee - HOA Fee'

An amount of money that must be paid monthly by owners of certain types of residential property to an organization that assists with maintaining and improving that property and others in the same group. HOA fees are almost always levied on condominium owners, but they may also apply in some single family neighborhoods.

BREAKING DOWN 'Homeowners Association Fee - HOA Fee'

Condo owners almost always pay HOA fees to cover the costs of maintaining the condo building's common areas such as lobbies, patios, landscaping, swimming pools and elevators. The association may levy special assessments from time to time if the HOA's reserve funds are not sufficient to cover a major repair, such as a new elevator or new roof. HOA fees can also apply to single family houses in certain neighborhoods, particularly if there are common amenities like tennis courts, a community clubhouse or neighborhood parks to maintain.

If owners of property belonging to a homeowners' association do not pay the required monthly (sometimes annual) fees as well as any special assessments, the homeowners' association can foreclose on the delinquent homeowner. Prospective homebuyers should always inquire as to whether the property they are interested in has HOA fees before committing to buy it because these fees can affect a homeowner's ability to afford the property. HOA fees can vary widely depending on factors such as community amenities and how effectively the reserve fund is managed.

  1. Price-to-Rent Ratio

    A mathematical calculation utilized in the Trulia Rent Vs. Buy ...
  2. Homeowner's Association - HOA

    An organization in a subdivision, planned community or condominium ...
  3. Condominium Fee

    A maintenance fee charged by a condominium complex to cover the ...
  4. Cooperative Insurance - Co-Op Insurance

    An insurance for owners of co-op apartments that covers losses ...
  5. Condominium

    A large property complex that is divided into individual units ...
  6. Covenant

    A promise in an indenture, or any other formal debt agreement, ...
Related Articles
  1. Home & Auto

    5 Mistakes to Avoid When Buying a New Home

    Learn about home ownership and some of the pitfalls a potential homebuyer faces. Understand five specific mistakes all homebuyers should avoid.
  2. Retirement

    Does Condo Life Suit You?

    Association fees and disputes with neighbors could spoil your move if you're unprepared.
  3. Home & Auto

    9 Things You Need To Know About Homeowners' Associations

    Restrictive rules and high fees are just some of the things to watch out for before joining an HOA.
  4. Home & Auto

    Condo Complications: The Issues Behind Ownership

    Being a "condo person" is just one of the issues you'll have to examine when deciding if a condo is right for you.
  5. Home & Auto

    An Introduction To Buying A Condominium

    This real estate investment provides unique advantages - and challenges.
  6. Personal Finance

    The 6 Most Expensive Apartments in New York City

    A look into the high, high, high end of New York City real estate.
  7. Home & Auto

    The Most Expensive Neighborhoods in Manhattan

    Understand why Manhattan has some of the priciest residential real estate in the world. Learn about the top four most expensive neighborhoods in Manhattan.
  8. Home & Auto

    The Most Expensive Neighborhoods in Los Angeles

    Understand the layout of the greater Los Angeles area and what is driving up home values. Learn about the top eight most expensive places to live in LA.
  9. Personal Finance

    Should You Renovate or Move?

    Besides cost, what factors should you consider in deciding whether to remodel your home or move? This tutorial guides you through the steps.
  10. Home & Auto

    4 Home Upgrades That Don’t Pay

    Many remodeling projects sound good in theory, but don’t recoup their costs when it’s time to sell the house.
  1. How do I calculate how much home equity I have?

    Even though it is normally assumed most people know their home equity, many are still confused about the topic. It is an ... Read Full Answer >>
  2. What are the typical requirements to qualify for closed end credit?

    Typical requirements for a consumer to qualify for closed-end credit include satisfactory income level and credit history, ... Read Full Answer >>
  3. What are some examples of financial markets and their roles?

    Some examples of financial markets and their roles include the stock market, the bond market and the real estate market. ... Read Full Answer >>
  4. What price-to-book ratio is considered average in the chemicals sector?

    You can use Microsoft Excel to calculate the loan-to-value ratio if you have the mortgage amount and appraised value of a ... Read Full Answer >>
  5. How does the loan-to-value ratio affect my mortgage payments?

    Several factors affect the mortgage rate you can obtain when you purchase a home. Lenders analyze credit histories and scores ... Read Full Answer >>
  6. What is the difference between a PMI (primary mortgage insurance) loan and a Federal ...

    Home buyers who are unable to contribute a traditional down payment of 20% may think home ownership is out of reach. However, ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  2. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  3. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  4. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
  5. Operating Cost

    Expenses associated with the maintenance and administration of a business on a day-to-day basis.
  6. Cost Of Funds

    The interest rate paid by financial institutions for the funds that they deploy in their business. The cost of funds is one ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!