What are Core Revenue Activities of HOA and Condo Management Companies?

HOA and Condo Management companies perform duties on behalf of their client communities. Actions from such actions are typically bucketed into three core categories, all of which are contracted in the Management Agreement between the HOA/condo association and the management company:

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Management and Accounting Fees (Recurring)

Management and accounting fees are charged by the HOA or condo management firm to the association client for the services they provide in managing the community. These fees usually cover administrative tasks such as managing financial accounts, processing assessments, overseeing maintenance, and enforcing community rules. The fees are typically a fixed monthly fee, paid at the start of the month. Larger communities with more amenities or complex governance structures often face higher fees due to the increased level of service required. Fees do not typically increase linearly with the number of units managed, as increased scale creates some scale benefit. HOA and condo management companies are typically bucketed into three categories: full service (providing both management and accounting), management-only, or accounting-only.

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Association Fees (Re-Occurring)

Association fees are also charged to the client by the HOA or condo management company, and typically represent non-standard fees charged a la carte. Examples can include additional association manager labor time incurred by the association, mailings to individual HOA and condo members within the community, processing fees for special assessments, management and upkeep of the association website, and community tax return preparation. The specific charges for these a la carte fees are included in the overarching contract between the association client and the HOA or condo management company.

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Homeowner Fees (Re-Occurring)

Homeowner fees are specific charges for individual homeowners for services or penalties not covered by general association dues, and specifically incurred by the homeowners' actions. These fees typically include escrow fees and transfer fees involved in the transfer of ownership of a dwelling and collection and delinquency-related fees on dues to the association. Homeowner fees are also included in the contract between the association client and the HOA or condo association, and the HOA or condo board grants the management company the ability to charge its homeowners for such services (either directly to the homeowner, or passed through the HOA or condo association itself).