Why did your HOA fees go up?

Why is the new total not enough to go on?

A higher monthly amount and a note that costs have gone up is not an explanation, and you can reasonably ask for one.

A total that moved tells you only that it moved. The question is which lines moved, by how much, and whether the categories are the same as last year.

Put last year's budget beside this year's. What looks like a rise can turn out to be a category split in two, two categories merged into one, a cost moved from one section to another, or a one-time cost — as well as a genuine increase in what the association pays for something. Only the last is what the note implied.

Where should you look first?

Insurance. The association's own policies — property, liability and others — can change sharply at renewal. Ask what the premiums were, what they are now, and whether the cover or the deductible changed.

The reserve contribution. This is the money set aside each year for repairs and replacements that come up on a cycle: roofs, paving, painting, pool equipment. It may be called the reserve contribution, the reserve transfer or the contribution to replacement reserves. If it rose, ask why.

Utilities and contracts. Water, electricity for the common areas, trash collection, landscaping, pool service, security. Ask which contracts were renewed, and at what price.

The management company's fee. If it is folded into other administrative costs, ask for it on its own line, and for what it covers.

Anything called miscellaneous, administrative or other. These are not categories. Ask what is in them.

Anything new. A line that appears for the first time is not necessarily wrong. It is always worth a question.

Why can the reserve contribution jump?

Reserves are the association's savings for the large repairs and replacements that do not come every year. Where the association has a reserve study — a list of the parts of the property that will need repair or replacement, when, and at what estimated cost — the yearly contribution is usually set from it.

The contribution can rise sharply when the study is updated: costs have gone up, a part is wearing out sooner than expected, or the reserves have fallen behind what the study says they should hold. Each of these can be explained. Ask what changed in the study, and which parts drove the change. How to read your association's annual budget shows where the budget report sets out the reserves.

Is a special assessment part of your fees?

No. A special assessment is a charge of its own, on top of your regular fees, for a particular cost — a major repair, a shortfall in the reserves, or an insurance deductible after a claim, for example. It may be due at once or spread over a set number of months. It is not a line in the yearly budget, though the budget report may say whether one is expected.

Ask what it is for, how the total was worked out, how it is shared among the homes, when each payment is due, and whether the reserves could have covered any of it.

What can you ask the board?

Your fees fund the association, so you can reasonably ask how they are spent. Put your questions in writing, and keep them specific:

• which lines rose, and why;
• what changed in the reserve study, if the contribution rose;
• what the insurance premiums were before and after renewal, and whether the cover changed;
• what the management company's fee is, and what it covers;
• how last year's budget compared with what was actually spent — the year-end financial statement shows that.

A board that answers specific questions clearly has told you something. So has one that does not.

Should you stop paying while you ask?

No. Asking about a charge and not paying it are two different things. Keep paying, and put your questions in writing.

What does Synclair do?

Synclair sets out your association's annual budget and year-end financial statement line by line, and shows what the figures say. Each budget line sits beside last year's figure where the budget prints one, and a year-end financial statement for the same fiscal year can be set beside the budget. These are the association's own figures, not amounts worked out for your home. If you're paying for a service you aren't receiving, you can record it, and it stays on record with a date. If something needs raising, Synclair can draft a letter for you to check and send in your own name, and once it's sent you can record the reply and the outcome.

Only owners pay for Synclair: never managers, insurers or suppliers.

One document is enough to start. It is free for three months, for one property, and the three months begin when your first analysis is ready — not when you sign up. There is one free period for each email address.

Documents for a property in California or New York State are uploaded from an account: sign up, then upload the annual budget or the year-end financial statement.

See a worked example→