Considerations When Selecting an HOA Management Company

The board of directors for the HOA is faced with making countless decisions and acting in the best interest of all homeowners and the community as a whole. This can be a demanding and often thankless job, as many members do not understand the amount of work that goes into keeping the HOA running effectively. To operate more efficiently, homeowners associations may join forces with industry professionals and hire an HOA management company.

There are many different management companies to choose from, so how can the board know which one is right for their association? It is important for the HOA to do its due diligence and take a variety of factors into consideration. Kuester Management Group is a trusted name within the Carolinas and has a long history of providing quality management services to HOAs in Charlotte NC, Huntersville NC, Wilmington NC, Myrtle Beach SC, and Fort Mill SC. We encourage you to reach out with any questions you may have about selecting an HOA management company and keep the following tips in mind.

Why Work with an HOA Management Company?

One of the first questions homeowners have is why hire a property management company at all? While it is not required, and associations can remain self-managed, partnering with a community manager can ease some of the burden for the board and guide them in building a thriving community. Board members are volunteers and may not have significant experience when it comes to business management, accounting, law, project management, strategic planning, and other key functions.

A management company can fill in these gaps and more, offering exceptional insight and industry knowledge. Management teams are well versed in maintaining compliance, developing budgets, enforcing rules, and resolving conflicts. They can oversee day-to-day operations allowing the board to focus on matters that cannot be delegated and enable them to use their time more effectively.

Know What to Look For in a Management Company

Going with the first company that pops up in a search is not always the best option. The board should have a general idea of what these businesses do and what qualities are most important. This includes things such as:

• Education and Training. There are a variety of different certifications and licenses that community management professionals can obtain through organizations such as the Community Associations Institute (CAI). What level of education and training does the management team have, and what is their approach to professional development? Are there certain areas where they specialize?
• Years of Experience. Find out how long the organization has been in business and how long they have been serving the community where you live. Do they have a proven track record of results and feedback from verified clients? If it is more recently established management company, how much experience does the leadership team have in the industry?
• Scope of Services. What is the portfolio of services available, and how does that align with the HOA’s needs? If your association needs support with financial management, updating community rules, or managing vendors, does the management company have these specific capabilities? Do they offer pre-set packages, or are services customizable based on your HOA’s goals and budget?
• Communication and Availability. How quickly do they respond to phone calls or emails? How often will they be on site or following up with the board to check in? If an emergency occurs outside of normal business hours, what is their protocol? You want a community manager that is professional, responsive, and engaged.
• Technology. What software systems or tools are available to help streamline operations? Do they offer online portals, electronic payment solutions, or digital recordkeeping?

Create an Effective Process

Once the board knows what it is looking for in a management company, it is time to get the process started. Create a committee that includes homeowners so they are involved in the selection and know that their input matters.

Review existing operations. If your HOA currently has a management company that it works with, take a deeper dive into what is working well and what is not. What is compelling you to switch companies? What do you want to see from your next community manager?

Define the association’s needs. What areas could the board benefit from the most help? Are you struggling with maintenance issues, organizing board meetings, creating an effective budget, or enforcing community rules and collections? Also consider how much the HOA is looking to spend. Then create a detailed bid specification or request for proposal (RFP) to solicit prospective management companies.

Compare available options. Review all of the proposals that were received and look at one each one has to offer. Which company can best meet the association’s needs for the most affordable rate? Conduct interviews and meet with the management teams to get clarification, negotiate terms, and get a better sense of who they are and how they operate.

Sign an HOA management agreement. Consult with your attorney to develop or review the management contract and ensure that the terms and conditions are in your HOA’s best interests. All services should be clearly defined, as well as payment schedules and termination clauses. Once approved, the board and management company should both sign off and retain copies for their records.

Enjoy the benefits of partnering with an HOA management company. After the contract is in place, the association can start making the most of this relationship and helping its community to thrive by having valuable supports and resources in place.

Frequently Asked Questions