The Difference Between Homeowners Associations And Property Management

Wherever you’ve lived before, you’ve probably come into contact with, or at least heard of, the homeowners association (HOA). They seem to dictate what you can and cannot do with your property and ensure the rest of the neighborhood is up to scratch. However, many people seem to confuse this association with property management, which is quite different.

Property management companies are private entities that deal with tenants directly, whereas HOAs report to the local board and oversee an entire neighborhood. There are various differences between the two, and we’ve put together this mini guide to help you tell the two apart.

What are Homeowners Associations?

A homeowners association is a committee that is run by volunteer homeowners who live in your neighborhood. They sit on a board of directors that is often run by a separate community association management firm and make decisions that ensure the neighborhood is properly cared for and meets high standards so everyone lives peacefully. 

The HOA doesn’t handle individual properties but rather looks at the community as a whole. They will put together rules and regulations that homeowners need to follow so that the values of the neighborhood are kept intact. 
It is a pretty big organization, including an admin team who will answer phone calls and queries from homeowners and other sections implementing the policies they have created. There are also often HOA meetings that anyone can attend and raise concerns, ensuring everyone in the neighborhood is heard and has a voice. 

What does an HOA management company do?

An HOA management company has a wide range of tasks, which is why they are often built with different sectors that handle separate issues. The main things they handle are collecting dues and maintaining all the public areas in the neighborhood, such as playgrounds and community pools. They also put together the policies and ensure all the homeowners in the neighborhood know what is expected of them and their properties. 

Instead of going to one of the homeowners on the board of the HOA, the management company will act as a middleman, answer any queries, and ensure all the rules are followed. 

Other duties of an HOA management company include:

• Hire professionals who will look after the public areas in the neighborhood
• Managing late fee collections
• Handling the bookkeeping and accounting for the HOA
• Answering any questions the HOA or other homeowners may have
• Going through neighborhoods and ensuring they are following the rules
• Advising the board on their policies

What is a property management company?

A property management company works directly with landlords and tenants rather than looking at a neighborhood as a whole. They take over the typical responsibilities of a landlord and make time for the landlord to focus on other things. A property manager will be the first point of call for the tenant if they need any help, and they know everything about the area’s laws and regulations to ensure they are being followed. 

In simple terms, the HOA will make the policies, and a property manager will help ensure the landlord is following these policies. They also act as a direct liaison with all tenants, including finding them in the first place and helping them sign the rental agreement.  

Property management companies work with both private landlords as well as larger corporations. They aren’t all the same and will offer different services depending on their expertise and years of experience. 

What are the responsibilities of property management companies?

Similar to an HOA management company, property managers have a wide range of different duties. The main one is ensuring that things run smoothly between the tenant and landlord and keeping track of all the latest laws and regulations surrounding renting a property in the area. 

Property managers don’t have as much power as an HOA, but they need to ensure all the policies they implement are followed. Their range of tasks involves a wide range of different things, so they need to be fairly skilled in a number of different areas. 

While all property management companies are different, the main responsibilities that they typically offer include the following:
 

• Marketing the property to find new tenants
• Conduct tenant screening
• Assisting with initial inspections and helping the tenant move in
• Maintaining the property and managing emergency repairs
• Collecting rent each month
• Handling the bookkeeping and accounting for the property
• Inspecting the property once a tenant has moved out
• Communicating with both the tenant and landlord

Can a company do both?

Of course, a company can handle both property management and HOA management, but it is quite difficult for them to do so. When you offer more services, it makes it harder to keep track of everything, and you’ll need to hire a larger team to work in the different departments. 

Similarly, if you offer too many services, you lose an aspect of expertise as well. Both property managers and HOA managers already have a wide range of duties, so when you combine them, it can be hard to be good at everything. The best way to be successful as a company is to do what you know, and when you extend yourself too much, you’re only setting yourself up for failure.

So, you can start a company that does both jobs, but it isn’t recommended. It’s best to choose one or the other and grow your number of clients rather than increase the number of services you offer. 

Final thoughts 

There is quite a big difference between an HOA and a property manager. However, it's easy to get confused when you don’t know what either is. To put it into a sentence: An HOA sets the policies for homeowners and property managers to ensure that these policies are followed.

If you are part of either type of company, you can get some extra assistance from property management software like Hospiria. You can handle all your tasks from one simple dashboard and ensure substantial growth in the future.