HOA Management. Yes or NO?

[Ben McMahon]

So I own a small property management company, and am looking to grow. I have manpower and systems to do it. I recently talked to a business broker that has an HOA Management company. I am sure I can figure out how to manage the HOAs, but is there additional qualifications or designations other than having a real estate brokerage?

Also, is this a good business to be in?  What does it involve?  Any help would be great.  Thanks

[Brad Larsen]

@Ben McMahon Ben - We have an HOA section of business, and I will tell you it's very slow and tough to get into as a small player. Essentially, you are pitching your services to a volunteer board of folks managing other people's money. Switching can be so painful, even if you make it super easy for them, that it's just not a high priority in their life.

Two ways to crack in - find the disgruntled HOA boards and whore yourself out to them....or find a developer and get to the neighborhood (HOA) before it's even built.

If you were looking to expand, I would recommend going into the commercial realm.  

The margins, headaches, and liability from HOA's may not be worth it for a small player. If you can someday squeeze 10% to 15% profit margin - you would be doing great. However, managing SFH's right can be double that without being overly dynamic.

Hope this helps!