buying your first home - what you should know

4 Reasons to Look for a Townhome That's Not Subject to a Homeowners Association

When you are looking to buy a townhome, the last thing that may be on your mind is whether the house is in an area that's governed by a homeowners association. After all, you probably are looking at things like how many bedrooms a townhome has or how close it is to the best schools in the area. A homeowners association, or HOA, is designed to protect the property values of the homes it governs. However, an HOA can dictate more than a few things about how you live your life if you buy a townhome that is subject to its rules. That's perfectly fine for the needs of many home buyers, but here are some reasons that it might not be the best idea for you.

A Homeowners Association Has the Power to Foreclose on Your Home

Although this may sound extreme, the truth is that an HOA may have the power to foreclose on your home depending on where you live. If someone gets behind on fees, the Community Associations Institute advises that foreclosures should only be done as a last resort if the homeowner won't settle a significant debt to the association.

A Homeowners Association Can Deprive You of Choices

It's a fact that most HOAs do deprive you of some choices. In trying to protect the property values of the houses in the neighborhood it governs, it sacrifices some independent freedoms of homeowners. The key factor in whether you can live with the choices it restricts is to get more information from the HOA over the townhouse you're interested in. While some may just have basic rules on how often you need to maintain your lawn, others have strict rules about which flowers you can plant and how you can decorate for the holidays.

A Homeowners Association May Raise Your Dues Unexpectedly

Belonging to an HOA means that there are some inevitable costs involved. You will likely have monthly payments to make in addiction to an annual association fees. If you currently live paycheck to paycheck, an unexpected increase in the fees may cause a lot of problems. Be sure to weigh whether that possibility is worth it. Also, some HOAs may have rules in place about how often they can raise dues, so be sure to ask if you are considering one.

Be sure to ask your real estate agent about the different HOAs in your ideal location. Your real estate agent can help you find townhomes that are and are not subject the guidelines of an HOA.