HOA vs No HOA

[Eleanor V.]

Hello everyone,

Looking to purchase a 4plex in AZ (Phoenix/Tempe/Mesa area). Would love to know your thoughts/experiences/woes/violent reactions ???? as to the pros and cons of properties with HOA fees vs ones without. On the one hand, I do like the fact that most fees cover common area maintenance/preservation but on the other hand, I'm worried that I have less control of these maintenance decisions. Not sure if I'm making sense...

Thanks!

[Yuliany W.]

Hi Elie,

I generally avoid HOAs. Mainly because it can reduce your cash flow significantly and also the control factor that you mentioned. However, most of the multifamilies with HOA look nicer and well maintained.

If the HOA decided to raise their fee, more likely you will also have to raise rent to maintain your current cash flow. This might make it harder for you to rent out your units if you are competing with other units that don't have HOA and can keep their rent low.

There are definitely pros and cons with HOA. I have a friend who invest in Indiana and his condo has HOA but the HOA is very inexpensive so he is happy with it.

I was discussing about HOA with @Johnson H. a while back he might have something to add to this thread.