Hiring an association management company is not as easy as it seems. There are many moving parts, and it requires a certain level of preparation and research to accomplish smoothly. If your association is looking to hire an HOA management company soon, there are a handful of tips you should adopt to ensure a seamless and effective selection process.
Are You Hiring an Association Management Company?
If you have ever been or are currently an HOA board director, then you are well aware that most HOA boards are made up of volunteers from members of the community. These volunteers are unpaid and often have to juggle their daily lives with board duties. As such, it comes as no surprise that HOA board members are usually tired or feel overworked.
As a remedy, a majority of HOAs turn to association management companies for help. But, what is an association management company in the first place? To put it simply, an association management company — also referred to as an HOA management company — is a business that provides non-profit organizations, like homeowners or condo associations, with management services.
While these types of companies help lighten the load of an HOA board, the selection process is not so simple. You have to do a proper amount of research and prep in order to arrive at the best HOA management company for your community. If you have plans to hire an association management company now or in the near future, consider these tips:
1. Know Your Needs
The process of hiring an association management company cannot begin unless you know what your HOA needs. List down what services you are looking for in a management company before starting your search.
It is best to accomplish this with your fellow board members, so make sure to schedule a separate meeting to discuss this matter. You may also want to gain input from community residents.
2. Make Sure They Are Licensed or Accredited
Some states do require association management companies to carry a license. Check your state laws to see if this applies to you. If it does, then do not hire an unlicensed association management company. Even if it does not apply to you, licensed companies have an understandable edge over unlicensed ones.
When deciding on an association management company, it is a good idea to look for one that is accredited by the Community Associations Institute (CAI). CAI is a top accreditation for the community association industry. They provide information and education to community associations and the professionals who support them.
3. Select a Company That Shares Your Community’s Values
Yes, requesting a proposal is smart, but researching beyond a proposal is always the best when deciding whether a company is right for you. The company’s culture and values are important, and you can usually tell how they will manage your community based on these two things. Focus on their mission, honesty, and commitment to truly see what your future as an association holds.
4. Prioritize Service over Price
Pricing is understandably a top consideration for many associations, even yours. However, you must not sacrifice the quality of service along the way. It is a good idea to first separate a company’s services from their fees when evaluating.
This way, you can conduct an unbiased review of their services alone. After that, you can cross-examine their services with their price to get an overall evaluation.
5. Ask About Their Screening Processes
If you are having difficulty screening potential homeowners now, hiring an association management company will be a great deal of help. Communities screen their tenants for a reason, so you must ask HOA management companies about their screening process (if they even have one). Having a subpar screening process can cost you more in the long run.
6. Review Their Maintenance Management
One of the benefits of hiring an association management company is getting help with maintenance management. After all, a homeowners association’s primary job is to maintain the community.
If you want a company that will take over everything maintenance-related, then you should not go with one that does not offer maintenance management services. If your candidate does handle it, how do they intend to go about the process?
7. Make Sure They Have Good HOA Managers
HOA managers act as a liaison between your association and the management company. For this reason, the company you ultimately go with must have good HOA managers. Apart from having excellent communication skills, HOA managers must be competent, responsible, and have a squeaky clean background. Go through your list of association management companies and check whether their HOA managers are reputable.
8. Check for Insurance
When selecting the right association management company for you, it is only logical to ask for copies of their insurance certificates. An HOA management company must have above-satisfactory coverage. This includes both liability insurance and workers’ compensation for its employees.
9. Aim for a One-Year Contract
Another good tip when hiring an association management company is to negotiate for a reduced-year contract. Most companies will start with a three-year contract, but three years can feel like an eternity if you end up stuck with a subpar management company. As much as possible, aim for a one-year HOA contract with an option to renew annually. Of course, take price into account as well and make sure it does not change just because you asked for a shorter lock-in duration.
10. Have Your Lawyer Review the Contract
Before sealing the deal with your signature, see to it that your HOA’s lawyer gets a chance to review the contract. It is not recommended to go with the very first contract the HOA management company presents to you.
There may be little details you can change or fine print that you missed. It is also a good idea to read up on the company’s termination clause. Look for at least 60 days’ notice to give your association enough time to start the selection process again.
11. Review the Company’s Availability
Be sure to call in the office of the association management company and check for professionalism. How available does the company make itself? Do they have a 24/7 answering service? Are they willing to help when emergencies arise?
Choosing the Right Company for Your Community
Hiring an association management company can be a long, drawn-out process, but every step is definitely essential to the success of your community. If you rush it and end up choosing a bad company, your association will suffer the consequences and losses. By applying these tips, you can be sure to select the right association management company with whom you can share a fruitful and healthy working relationship.
If you wish to skip the entire process, though, you can go with a reputable association management company like us. In any case, feel free to contact us anytime.
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