Money; it’s on everyone’s minds. Just as homeowners need adequate income to pay their bills and maintain their homes, the homeowners association does as well. Without a well-planned and managed budget and reserves, the HOA may find itself in financial distress, and this can be passed on to homeowners through due increases or special assessments. In a new statement to the press, Kuester Management Group sheds light on ways that HOAs can be more financially savvy.
“One of the first things the HOA board should do is assess its financial knowledge,” says Bryan Kuester, President of Kuester Management Group. “Treasurers aren’t always CPAs or finance gurus. Partnering with a property management company can help cover these gaps in knowledge and ensure nothing is overlooked. A property manager can work with the HOA to not only create a budget that fits its needs and allows for adequate reserves, but also support timely collections.”
Kuester recommends that HOAs review service contracts annually. Compare options and prices and try to negotiate for a reasonable rate. When comparing, don’t forget to look at what services are included versus what the HOA actually needs. There may be opportunities to reduce expenses by changing providers or making adjustments to frequency or level of service.
Conducting a reserve study is also essential. A reserve study assesses what assets will need to be replaced, when, how much it will cost, and how much the HOA should be setting aside each month to adequately fund anticipated expenses. A properly funded reserve can cover repair and replacement of various components such as roofs or swimming pools, as well as emergency needs, without requiring a special assessment or increase in dues.
Staying on top of preventive maintenance can support fiscal responsibility as well, notes Kuester. Conducting inspections and making small repairs throughout the year can keep equipment and assets in good condition reducing risk for serious problems. It can also alert HOAs to impending problems and areas where greater expenses may be required in the future.
Is it also important that the HOA maintain transparency with homeowners. Members want to know how their money is being spent and they benefit from the dues they are paying. Kuester encourages HOAs to be upfront and communicate with homeowners about expenses, ideas for saving money, and any changes being proposed. Homeowner input and feedback is important before making any major changes, especially if it directly impacts members.
Kuester Management Group is proud to support HOAs in achieving better financial management and creating effective and efficient organizations that meet the diverse needs of homeowners. HOAs that are struggling with their finances or are unsure if money is being managed as effectively as possible are encouraged to contact Kuester and see how a property manager can help.
Kuester Management Group, a division of Kuester Companies, works to protect property values and enhance the quality of life in each of its managed communities. Providing a full range of association management services, Kuester Management Group has worked to foster strong, resilient, and unified communities across North and South Carolina. The company is proud to offer on-site property managers, all zealous for building strong communities meant to stand the test of time.
More information is available at www.kuester.com or @KuesterCompany.