When talking about property ownership, you can encounter different types of associations, such as Homeowners’ Associations (HOAs), Property Owners’ Associations (POAs), and Condominium Owners’ Associations (COAs).
Understanding the differences between HOA, POA and COA Understand Everything is crucial if you’re a homeowner or a prospective buyer. Although they may seem alike, each has its unique roles in governance, maintenance and management of the property.
Each has its own rules, responsibilities and fees that can impact your daily life. They also differ in terms of financial obligations and management operations.
This article will explain the differences between HOA, POA and COA, making it easier to determine how each association functions and what it means for you.
What is an HOA?
The most common of the three is HOAs. They are non-profit organizations focused on keeping communities organized and operating.
Composed of a group of similar homes sharing common areas, the main goal is establishing a safe and comfortable neighborhood.
For this, the community must be committed to a set of rules and regulations created by the HOA board. Those rules regulate the maintenance and social aspects of the property.
An HOA’s purpose is to facilitate property management and ensure its value over time.
Responsibilities of an HOA
An HOA has a board with people designated to critical responsibilities. For instance, a board usually has a president, vice-president, treasurer, secretary and member-at-large. Those members are responsible for:
- Enforcing Rules, regulations, and covenants.
- Financial Oversight of the HOA’s budget
- Maintenance and Upkeep of common areas, buildings, and facilities.
- Vendor and Contract Management.
- Dispute Resolution: among homeowners.
- Communication with Homeowners
- Meeting Management
- Legal Compliance
- Policy Development
- Community Building
Fees for a HOA
To keep all those operations going is necessary a budget. And the budget comes mainly from the fees members of the community pay. Those fees are split into five kinds:
- Maintenance charges
- Condo fees
- Co-op dues
- Strata fees
- Common charges
Depending on the rules of the HOA, the fees may be charged monthly, quarterly or even annually.
What is a POA (Property Owners Association)?
POAs are much broader than HOAs. They manage multiple types of properties and include different types at the same time, such as residential and business. They even manage areas that contain HOAs and COAs.
However, because of their broadness, POAs have a very limited scope of authority in terms of the community’s everyday life.
Their purpose also aims at large scale. As HOAs are more interested in the community’s prosperity, POAs want to develop the area.
Usually by increasing local commerce and real estate and facilitating business licensing, zoning rules, and neighborhood projects and events.
How do POAs work?
The POA needs a team of property or business owners, developers, and investors to improve the community. These people develop commercial plans to implement in their respective areas.
They also promote events, enhance structures and keep industries working correctly. POAs don’t need a board of directors to do so.
POAs can offer educational opportunities for the community and promote events that focus on networking and community engagement. Although they don’t own those spaces. So, POAs can:
- Manage mixed-use properties
- Broader area oversight
- Commercial property rules
- Community-wide infrastructure
- Greater involvement in development
Fees for a POA
The key element to maintaining a POA is donation. Unlike HOAs, which have different types of fees, POAs need donations because of their broader needs.
Since POAs commonly develop parks, enhance public spaces and support significant community events, they often seek donations from businesses or governmental funds to act.
However, community residents who want to participate more in the activities of the POA can also donate.
What is a COA (Condominium Owners Association)?
COAs serve a similar purpose to HOAs and are often used with the same meaning. However, COAs take a different approach to ownership.
Basically, in HOAs, residents own their property, and the association owns the common areas while in COAs, all residents own their properties and percentages of the common areas.
So, the COAs don’t own the common areas but oversee it.
How does a COA work?
In terms of operations, they are very similar to HOAS. They also have an elected board with volunteers. And that the board works for the benefit of the community. COAs are also non-profit organizations.
One key difference with a COA is the division of responsibility between the interior and exterior of the condo units. While condo owners are typically responsible for their unit’s interior, the COA manages the upkeep of shared walls, exterior elements, and communal areas.
Fees for COAs
COA fees, usually higher than HOA fees, cover these communal expenses, ensuring the property is well-maintained, and services are provided for the benefit of all residents.
Key Differences Between HOA, POA and COA
Property Types Governed:
TOne of the key differences between HOA, POA, and COA lies in the types of properties they govern.
HOAs typically manage residential communities, overseeing single-family homes and their shared areas.
COAs, on the other hand, focus solely on condominium complexes, where residents own their individual units and share ownership of common spaces like hallways and pools.
POAs have the broadest reach, managing a diverse mix of property types, including residential, commercial, and even industrial properties, often within larger development zones or communities.
Scope of Responsibilities:
HOAs concentrate on maintaining individual homes and shared spaces like parks or clubhouses, ensuring they remain in good condition and adhere to community standards.
COAs are responsible for both exterior maintenance and shared amenities within a condo building, such as roofing, lobbies, and hallways.
HOAs and COAs usually have a board of directors elected by the community, which enforces rules and manages the association’s operations.
In contrast, POAs have a much broader role, which may include overseeing the development of commercial areas, parks, and mixed-use properties.
Governance & Regulations:
HOAs tend to have more rigid regulations governing individual property aesthetics, while COAs enforce shared spaces and building structures regulations.
POAs, however, often operate with a less hands-on governance structure, sometimes without a formal board, focusing on larger development goals rather than detailed property management.
Fees & Assessments:
HOAs collect fees primarily for the upkeep of common areas and community amenities, typically lower than COA fees.
COA fees, often higher, cover more extensive maintenance of shared walls, roofs, and amenities, ensuring the building remains functional and aesthetically pleasing.
POAs, in contrast, rely less on fixed fees and more on donations or contributions from businesses and residents, as their responsibilities encompass broader community improvements and infrastructure projects.
Benefits of HOAs, COAs and POAs
HOA:
Homeowners Associations benefit from maintaining property values and ensuring that community standards are upheld.
By enforcing rules, HOAs promote a cohesive, clean, and orderly environment, which can enhance the neighborhood’s overall appeal.
However, the same regulations that protect the community’s appearance can feel restrictive to some homeowners, as they might limit personalization or changes to their property.
Still, these rules are usually established to benefit the greater good of the community.
POA:
This wider scope covers both residential and commercial spaces.
This can bring flexibility, especially in areas with mixed-use developments or where both homeowners and businesses coexist.
Work to develop and enhance the overall area, which can attract more commerce and improve the local economy.
However, the larger area of responsibility can sometimes result in higher fees, especially when large-scale community improvements are needed. Still, these investments generally aim to foster long-term growth and development.
COA:
Condominium Owners Associations provide the advantage of collective maintenance, meaning condo owners don’t have to worry about the upkeep of shared spaces like hallways, roofs, or external walls.
This creates a well-maintained environment and reduces individual responsibilities. On the other hand, COAs typically have more control over external property decisions, which may leave condo owners with less autonomy regarding changes outside their units.
The fees are often higher due to the extensive communal services, but these fees contribute to maintaining a well-kept and desirable living environment.
Conclusion
In conclusion, understanding the differences between HOA, POA and COAs is essential when considering property ownership.
Each type of association plays a unique role in maintaining and managing properties, whether through the more focused community standards of an HOA, the broad oversight of a POA, or the shared responsibilities within a COA.
By knowing how these associations function, what they govern, and the fees they require, homeowners and buyers can make more informed decisions that align with their lifestyle preferences and property needs.
