40 million U.S. households, or just over half of homeowners, live in HOA communities, reports iPropertyManagement.com.

Like them or loath them, HOA communities are becoming more prevalent, making it harder for buyers to find a dream home that does not belong to an HOA.

The good news is that the majority of homeowners think that their fees or dues are reasonable. But there are still many owners who believe their fees are too high.

What happens if they are right?  Is there anything you can do to lower fees?

Read on to find out.

Table of contents

• What are HOA fees?
• What are HOA fees used for?
• Average HOA fees
• Why are HOA fees so high?
• What can I do if my HOA fees are too high?

What are HOA fees

HOA fees are monthly or annual charges that owners must pay. There is no getting around paying these fees if you live in a governed community.

Whether you’re considering a condo, a townhouse, or a single-family home within a managed neighborhood, it’s important to include HOA fees in your monthly financial equation.

What are HOA fees used for?

HOA fees go toward maintenance and operations. While the list below is nowhere near exhaustive, it gives you a general idea of how fees are used.

• Maintenance of common areas – this includes things like landscaping, painting, and keeping swimming pools clean. Regular upkeep ensures that shared spaces remain clean, safe, and enjoyable for owners and residents.
• Repairs and renovations – clubhouses, gyms, and community gates need regular repairs or updates. If neglected, someone could get hurt.  
• Utilities for common areas – electricity, water, and trash services for shared spaces are covered by HOA fees, keeping communal areas operational and enjoyable.
• Insurance – HOA fees are used for insurance, protecting the association against damage and liability.
• Reserve funds – a portion of HOA fees should be used to fund future expenses, such as major repairs or emergency needs.

Average HOA fees

Average HOA fees will vary depending on several factors, including:

• the types of amenities and services provided
• the cost of living in the region or city
• the size of the community
• the cost of the home
• inflation

That said, average fees for single-family homes are between $300 – $400 per month ($3,600 – $4,800 annually).

While people are never happy about HOA fees, the Foundation for Community Association Research found that 57% of people who participated in the 2024 Homeowner Satisfaction Survey felt their fees were “just the right amount or too little.”

• 16% of participants reported paying $25 – $50 per month
• 18% said they paid $51 – $100 per month
• 26% said they paid $101 – $300 per month
• 12% paid $301 – $500 per month

Fewer people feel their fees are reasonable today than back in 2020 (62% vs 57%), but most owners understand why fees must go up.

Underfunding will lead to long-term financial issues. Special assessments, which generally cost owners more money, become unavoidable.

Why are HOA fees so high?

$300 a month might not sound like a lot, but fees have increased quite drastically over the past 5 years. Some owners have seen their fees double since 2020.

Keep in mind that board members aren’t raising fees because they feel like punishing owners (they also have to pay these fees). Rather, one of the primary reasons why HOA fees have gotten so high is inflation.

The increasing costs of insurance, services, labor, and materials have placed a great deal of financial strain on HOAs, often forcing them to make tough choices between hiking fees or cutting back on services and delaying maintenance. Many boards find themselves doing a bit of both to manage budgets.

Labor and wage increases are also risingto match the cost of living, meaning the expense of hiring staff for maintenance, legal guidance, and property management, goes up.

Unexpected events such as natural disasters or big maintenance emergencies can lead to sudden and substantial expenses, and owners have to deal with the costs.

When communities are hit with a large, unexpected cost, the financial strain can be immense, especially if the reserve funds are too low to cover everything.

As a result, HOA fees may need to be increased, and even then, the association may need to take out a loan or levy a special assessment.

Insurance premiums have spiked in some regions. HOAs simply were not prepared for these types of increases. Better rates are nearly impossible to find, and cutting coverage is not usually a smart option.  

What can I do if my HOA fees are too high?

Full disclosure, your HOA probably can bring fees back to where they were half a decade ago (unless spending has been out of control lately).

But there are small, reasonable steps communities can take to ensure owners aren’t paying more than they need to.  

For individual owners

Be the change you want to see

You’ve heard it before, but if you really want to see changes in your community, consider running for a position on the board. You’ll have the opportunity to take on a more active role in the budgeting process and see if money could be spent more strategically.

Be considerate when using shared facilities

Be conscious of what you do when using a shared space. For example, you can turn the air conditioning off if no one is using the clubhouse when you leave. Or, avoid dropping weights on the ground to minimize damage.

While these things may not seem like much, if everyone helps out, they can add up and save the HOA a lot of money in the long run.

For boards

Use HOA website software

Technology has become essential for cost-effective HOA operations.  Whether you are a self-managed HOA or you pay a property management company, HOA website software will help automate repetitive manual tasks and streamline workflows.

Manual labor is reduced, and costs associated with mailing notices or documents go down since communications can be shared electronically.

Plus, your owners will find it easier to stay informed and connected with a user-friendly community website available to them.   

Ask about lowering premiums

Currently, there is little room for negotiation when it comes to insurance premiums. But it never hurts to ask.

You may not get the answer you were hoping for. But you may also get a pleasant surprise.  

Stay on top of routine maintenance

Maintenance is a big part of managing an association, and it can get costly. But when possible, avoid putting off routine inspections or tune-ups.  

Smaller repairs are easier and cheaper to make than big ones. Plus, this is the best way to prolong a component’s useful lifespan.  

Conduct an audit

Performing an audit of your budget can help to stabilize HOA fees. An audit will help the board identify areas where overspending is occurring.

An objective audit report will also help the board to uncover opportunities for cost-cutting, and improve financial forecasting.

Conclusion

HOA fees are rising. In most cases, boards must increase them in order to keep up with maintenance and operational obligations. However, fees should never be artificially high.

If your community is struggling with finances, reach out to a certified public accountant, financial planner, or someone who has the credentials to guide your association in the right direction.