A large chunk of people’s wealth is tied up in their homes. There are lots of factors that affect home price and there are lots of things that you can do to increase your home’s value. Unfortunately, there are a few things that can negatively impact your home value and the neighbors you have are right up at the top of the list.A few years ago, I decided to move in to a neighborhood that has a homeowners association. Sure, there’s always a bit of drama in those neighborhoods, but it’s worth it to me. I like the idea of having rules that EVERYONE has to follow. Every now and then, I’ll be driving through another neighborhood without those rules and see a house that just shocks the heck out of me. Cars parked on the lawn, junk all over in their yard, house in disrepair. Every time I see a house like that I wonder what their neighbors must be thinking. It’s obviously pulling down their home values. While I’m sympathetic to those neighbors, I also can’t help but look at the junky house. It’s like a train wreck.
So, we decided to build a site where neighbors can vent and share the view out their window. As bad as the houses seem to be near my neighborhood, I’m sure there are FAR worse out there.
Check it out at:
Oh man, I absolutely LOVE this idea. Unfortunately everyone in this area keeps their homes looking relatively nice, but I’ll be sure to keep an eye out for offenders of housing decency in my travels.
ooooh! Would it be against the rules to post a picture of my own dilapidated garage??
Put it up there Savvy!! :)
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Interesting, but look at it this way.
How much do you pay in HOA fees monthly? What if you took that $ and invested in conservatively over the time you owned the home?
Say your HOA charges $75/month and @8% interests in 5 years that’s over $5.5K and after seven years it’s 8.4K.
Now do you think the HOA ITSELF will increase the value of the house by 8.4K? You also have to factor in that homebuyers have to ADD in the monthly HOA expense when they think about how much house they can afford further reducing the amount you can get for your house.
Chug the actually numbers for your situation then write a follow up.
Thanks for the comment Penty. We pay $170 per year in homeowners dues. This pays for upkeep to our common areas and funds the property management of the neighborhood etc.
If I invested this for 20 years and got 9% interest on the money compounded monthly, I’d have about $9450. I think I’ll beat that in equity gains. Our neighborhood has proven popular *because* of the HOA dues. Some people really prefer to have another layer of rules to keep their neighbors in check. Neighborhoods near us that don’t have HOA’s are not nearly as nice. Towards the end of the 20 years, I anticipate it being even better for us because as neighborhoods tend to get older, more “remodels” happen. Sometimes the owner’s idea of what looks good, and the rest of the neighborhood don’t always line up. With an HOA, they have to.
Agreed, you might beat that in OVERALL equity gains, but you need to look at just the equity gains the HOA get you. Also look at the rate of HOA fees increase, usually much faster inflation from the people I’ve asked.
As for the “extra layer†of rules, we’ll have to agree to disagree cause I’ll pass. I haven’t met one person who likes their HOA (not including you, of course so I guess I should say “in personâ€). They have found them restricting on things which don’t matter (needing approval for changes in the backyards and such) and worthless about thing which actually cause property values to drop.
Personally if I own the land and follow all the laws I should be allow to do what I want with my property.
Ummmmmm, whatever you want? Yeah that’s great.
You’re the guy painting his house orange w/ white trim huh? Or parking all those dead cars in the yard.
to jbat,
No. I’m the guy who wants to put more landscaping in the front yard than grass and a single pathetic tree (lame). Sure, HOAs MAY stop the neighborhoods from declining in value but they ALSO stop individual properties from growing past the local home values. Yeah, all the houses rise and fall in price together. Even if someone wants to add a bit MORE value beyond the HOA “norm†they can’t as the HOA literally holds them back, nice huh? God forbid your house be worth MORE than theirs.
If I wanted my house/yard to be a clone of all the other neighbors’ I’d move to a socialist/communist country. That’s what HOAs give you, less freedom for more security. Remember though the most “secure†investment also has the least return.
I don’t have a broken down car on my property nor would I. Can the guy next to me? Sure. Would like it? Not really but it’s called PERSONAL freedom, jbat, and some people still believe in it here in AMERICA. Just because a person believes in freedom over security/control doesn’t mean they’ll abuse it. Nice to know you’re your brother’s keeper.
You want to sign away your freedoms just to control your neighbors go ahead. Remember though those neighbors also control AND hold you back.
As I’m not a troll and would like to continue posting here in the future; I’ll refrain form commenting any more on this topic.
I’ve never had HOA dues before, but live a little far out in the country for those to have become popular……… I would not be able to handle the rules that go with the “neighborhoods” I’ve got a couple friends who have to get their garbage cans in on schedule or they get a notice from the HOA. That would drive me nuts!
I just visited parkitonthelawn.com and really liked the site. What a great idea for all of us frustrated by unkempt homes piled high with cars and other junk. I don’t see too much of it in my immediate neighborhood but I have seen plenty in my time. Proof that all you need is a good idea for a website.