Four Risks of Self-Managing HOAs in Phoenix

A lot of HOA leaders do not understand the importance of professional management. This is because they think their community can be self-managed. However, while this is possible, it can invite significant risks. HOA board members must be aware of these risks to make smart decisions about their management needs. Phoenix hoa management companies can meet these needs and allow HOA boards to focus more on making their community successful and happy. The following are some of the risks associated with self-managing a homeowners’ association:


HOAs that are managed by their board members can break the law unintentionally since they may not be aware of what the law says. For instance, local regulations may provide stipulations on reserve studies and HOAs must comply with the law. Non-compliance with applicable laws can lead to hefty penalties and fines.


Experienced HOA managers will ensure an HOA does everything it has to do to avoid lawsuits. They will put in place the right type of insurance to prevent possible legal action. In some instances, legal threats imposed on HOA board members are real and must not be taken lightly. Usually, these threats can occur due to a breach of fiduciary duty, which exists when a member of the board fails to act in the HOA’s best interest. The fiduciary duties of board members can be breached if they do not maintain the common areas, fail to fund the association properly, take actions based on a personal grudge against a community member, or take actions beyond the scope of the board’s duty. HOA management companies fulfill these obligations, reducing or eliminating the chances of the board getting sued on these bases.

Inefficient Operations

Managing an HOA community takes a lot of work such as scheduling and preparing meetings, contacting vendors, dealing with resident complaints and requests, as well as maintaining finances and facilities. Although volunteer community members can perform a lot of work in such areas, they usually cannot match the efficiency of HOA managers who can commit to working full-time for the HOA.

Lack of Transparency

Self-managing an HOA makes it difficult to maintain board member accountability. Although the majority of board members have good intentions, some people just don’t get along well with others. Sometimes, this can lead to ethical breaches. Transparency plays an important part in the satisfaction of homeowners. An HOA manager will ensure community members see how their dues improve the community and feel consistency in the enforcement of HOA rules. In turn, this makes sure residents will continue to trust their board.