The HOA Fee Reality Check
When you're looking at mountain condos or townhomes, the HOA fee can be a shock. I've seen buyers find a great $450,000 condo only to discover it has a $1,200 monthly HOA fee. That's like having a second mortgage payment. So how do you know if it's worth it?
What You're Actually Paying For
In resort communities, HOA fees often cover things you wouldn't see in regular suburban HOAs. We're talking snow removal (which is no joke at 9,000 feet), hot tub and pool maintenance, exterior painting and siding, roof replacement reserves, and sometimes even utilities like trash and water.
Some luxury developments include concierge services, shuttle to the slopes, or on-site property management. If you're only using the place a few weeks a year, these services can actually save you time and hassle.
The Math You Need to Do
Don't just look at the monthly fee—dig into what's included. A $1,000 fee that covers heat, water, trash, snow removal, and maintenance is different from a $1,000 fee that only covers landscaping and insurance.
Ask for the HOA's financials and reserve study. You want to see healthy reserves (generally 70%+ funded is good) and no history of special assessments. A property with low fees but depleted reserves is a red flag—you could be facing a $20,000 special assessment when the roof needs replacing.
How Lenders View HOA Fees
Here's something important: lenders include HOA fees in your debt-to-income ratio. A $1,200 monthly HOA fee reduces your buying power just like a $1,200 car payment would. If you're stretching to qualify, high HOA fees could push you over the threshold.
Some lenders also have maximum fee thresholds—generally they don't love seeing HOA fees above $1,500-$2,000 monthly, as it can indicate potential financial instability in the association.
Questions to Ask
How often have fees increased in the past five years? Normal increases are maybe 2-3% annually. If you see big jumps, find out why.
Are there any planned special assessments or major projects? The HOA board should be transparent about upcoming capital improvements.
What percentage of units are owner-occupied versus investor-owned? Buildings with too many rentals can have trouble maintaining standards and financing can be trickier.
Is the project FHA or VA approved? If not, your financing options are more limited, and that's a signal to dig deeper into the HOA's financial health.
Looking at a property with high HOA fees and want a second opinion? Send us the details—we can help you figure out if it makes sense financially.
