Homeowners Association Fee - HOA Fee

AAA

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.

INVESTOPEDIA EXPLAINS '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.



RELATED TERMS
  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. Does Condo Life Suit You?
    Retirement

    Does Condo Life Suit You?

  2. 9 Things You Need To Know About Homeowners' ...
    Home & Auto

    9 Things You Need To Know About Homeowners' ...

  3. Condo Complications: The Issues Behind ...
    Home & Auto

    Condo Complications: The Issues Behind ...

  4. An Introduction To Buying A Condominium
    Home & Auto

    An Introduction To Buying A Condominium

Hot Definitions
  1. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  2. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  3. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  4. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  5. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  6. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
Trading Center