Keeping expenses in check is a constant battle for homeowners associations. As the economy fluctuates, so does the cost of services. Furthermore, assets age and require more maintenance and eventual replacement. These things can quickly add up. Kuester Management Group has released a statement to the press regarding ways HOAs can develop better budgets to support financial stability.
“One of the largest responsibilities for the HOA is the budget,” says Bryan Kuester, President of Kuester Management Group. “They must carefully examine how money is being spent and where there are opportunities for cost savings. They must set association dues that allow for adequate coverage of expenses and reserves but are still affordable for homeowners. There is a balance that must be achieved.”
Whenever dues are increased, there is almost always pushback from homeowners. In order to curb complaints, the HOA should remain transparent about how funds being spent and why increases are necessary. The association should itemize its finances so that it knows exactly how much money is being spent and what it is being spent on.
“It is a good idea to review financials from the past few years and see how they have changed,” says Kuester. “Is more money going toward utilities? Have landscaping expenses increased? Consider why these changes have occurred and if there is a way to address them.”
That may mean soliciting bids from several vendors to see if a more cost-effective agreement can be reached, notes Kuester. Compare services, what is essential for HOA, and where cut-backs can be made. Maybe the grass only needs to be mowed once per week instead of twice. Work with vendors to negotiate improved rates if possible.
The HOA may also be able to save money by investing in energy-efficient lights, appliances, and other systems. Installing photocells or motion sensors on lights and changing thermostat settings when amenities are not in use can help generate savings in the long run.
If board members are not especially financially savvy, working with an accountant or financial advisor can be a worthwhile investment. They can support the board in creating a budget that fits the community’s needs and accurately reflects anticipated expenses and income.
A reputable property management company like Kuester can also support HOAs in managing finances. They can help the board identify what needs to be included in the budget, how to plan for the upcoming year, and how to communicate changes to homeowners. Regular communication and transparency can help homeowners to better understand how dues are spent and why increases are necessary.
Kuester Management Group supports HOAs with all aspects of HOA management and serves as a trusted resource for communities. For more information, contact Kuester today at www.kuester.com.
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.