HOAhomepage has been the HOA research arm of RA Gordon Co, since February 1999. For 20 years HOAhomepage has gathered data related to all elements of common interest developments across the country. Over the last five years, the company has focused on analyzing the impact of HOAs on the real estate market. HOAs are now present in all of the traditional real estate market segments, from entry level to luxury homes. However, HOA homeowners have purchased more than a lot and square footage, they have acquired an interest in a community. By design HOAs exist to maintain assets owned in common by the homeowners, so agents explain the HOA in those terms. However, fifty years ago, agents sold two things, price and community. Overwhelmingly homeowners rated “belonging” to a community as the most attractive element of living in a HOA. Today, “belonging” to a community is not even in the top five reason to purchase a home in a HOA. This is an unfortunate trend, because HOAs depend on “community” to function. HOAs are governed by homeowners, not professional managers. Managers only help the homeowners (board of directors) meet their mandated obligations. But over the last 30 years, a sense of community has eroded to the point where most HOAs have a hard time garnering enough interest to hold general meetings, let alone find board member volunteers.
HOAhomepage found a direct correlation between higher relative HOA home values and the HOAs that encourage a sense of community. Buyer interest in a specific HOA increases when homeowner connection is emphasized. This is one of the reasons that the Del Webb model works so well; over 55s are drawn to “Sun City” developments because of the social emphasis. This is obvious for the “retired” home buyer, with time on their hands, but there is no reason to think any other age group or socioeconomic group would not want to enjoy a sense of community. There are thousands of examples across the country where “community” is emphasized and the owners reap the value benefits.
Three years ago HOAhomepage shifted it’s emphasize to finding a way to identify these successful communities and replicating their success across the industry. Bottom line, there is no panacea for a “sense of community”, it can only be developed from within the community. We never thought we would find a magic bullet, but we did develop a solution.
After interacting with 10s of thousands of home owners, buyers and real estate professionals, over the last three years, we have concluded that the new owners are the key to reverse the trend. Our study was also able to profile these buyers as much as two years before they decide to enter the market.
HOAhomepage will be contracting with agents to represent us on a local level with every HOA in our network. These agents will be responsible for collecting information from the exiting homeowner and initial impressions of the new homeowner and their purchase experience. These ratings will help us improve the new owner’s experience and help the community improve their service to the homeowners.