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Finance
Cash-Strapped?
True story: a condominium community’s board of directors spent almost $50,000 in legal fees and court costs to evict
a corpulent canine that exceeded the weight limit for residents’ dogs...by three whole pounds.
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Pay Up!
In the tough economic environment that has hit our nation over the past few
years, many condo owners have faced job loss, pay cuts or just financial
uncertainty. Unfortunately, the signs of the times sometimes leads to an owner
not paying their common charges.
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Understanding Finances
For a crystal-clear picture of how an association is doing, there are few better
lenses than the community's budgets and financial reports. From an investment
perspective, they show the association board, property managers, the unit
owners/shareholders and tenants whether the property is solvent or not. If the
numbers add up and monies coming in and out balance, you can safely assume
everyone is doing their job, and upholding their financial and fiduciary duty
to the community. If the property is in the red, it’s important to determine why that is, and what needs to be done differently to
turn the situation around and restore solvency.
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Preparing for a Rainy Day
Unless it's a thoughtful gift or a party in their honor, nobody likes surprises.
That's especially true when it comes to sudden, serious, or non-negotiable
repairs to a condo building or HOA. A community must have enough money saved to
deal with major projects as they arise, or risk major financial and structural
troubles. But economic woes of residents such as unemployment or default, or
living on tight fixed incomes, means more HOAs are finding it difficult to keep
their reserves adequately funded.
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Letting it Slide...
It’s the same dilemma that single-family households across the U.S. are facing:
What bills need to be paid immediately and what bills can wait? And should we
stretch ourselves thin, taking more out of our bank accounts to pay for private
schools and that desperately needed vacation? Or should we cut back on
restaurants and renovations to put more into savings? The same goes for co-op
and condo buildings. While it may be tempting to delay payment on some bills,
or delay expenditures on maintenance or needed repairs, in the long run this
may end up costing far more than we ever realized. Read More
Flush with Cash
In December 2008, the National Bureau of Economic Research announced that the
United States was in a recession that had started back in December 2007. The
official announcement was old news for most Americans.
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By the Book
Unless you have a degree in accounting, your first board meeting could come as a
bit of a shock. You probably knew board members oversee the finances of your
association but who knew there were so many records to produce and filing
deadlines to meet?
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Prioritizing Projects
When money is tight, consumers typically put away their credit cards and take
stock—cutting out non-essentials, such as dining out and luxurious vacations—to make ends meet. Strapped homeowners will limit their funds to emergency
repairs only, such as patching up a leaky pipe, and put off anything else that
needs to be done until later. Those who live in an HOA might even take such
drastic measures as not paying their monthly dues until things improve.
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