We are Felton Heights HOA, a six-condo association in Normal Heights, San Diego. As a board member, I have been part of our journey toward self-management. In this post, we will share our experience of self-managing our HOA, including why we made this decision, the challenges we faced, and the benefits we gained from it. We hope this will be helpful for other HOAs considering self-management.
- After discovering that a former property management failed to make a series of payments resulting in a $10,000 water bill, the board decided to self-manage.
- Despite initial challenges, self-management has saved the HOA $6000 a year or about $500 a month in management fees and enabled them to accomplish important projects such as installing a new roof.
- The HOA overcame challenges by communicating, working together, and utilizing dues collection software and a shared email account to streamline their accounting and document storage.
- reTHINK HOA can guide and support HOAs interested in transitioning to self-management or looking for compliance software to help manage their community more efficiently.
Why We Decided to Self-Manage Our HOA
After discovering that our former property management company failed to make payments resulting in a $10,000 water bill, we decided to strike out on our own. Despite thinking it was a great idea, I remember feeling apprehensive about self-management. There were unknown pitfalls that worried me, and I wondered what we didn't know. That's why we needed to talk to someone who had already done it successfully. We were able to learn from their experience and prepare ourselves for the challenges ahead. While some of us were hesitant about self-management, we believed it was the best option to avoid such issues in the future.
The Rocky Start and Bumps Along the Way
Our transition to self-management was rocky at first. It took a while to get our money back from the control of the property management company, and the bulk of our bills were due around that time. Two owners fronted the money to cover bills and were repaid later. However, we all communicated throughout the process and tackled the challenges together. We started the process by filing with the state, setting up our bank account, and transferring vendor accounts.
Paying bills is very easy these days, with so many businesses having auto-pay. But setting up new accounts, such as with the Public Utilities, was a process. It may be more work for us, as we can't just call the HOA company when there's a problem, but we felt it was worth it since we are saving $500 a month.
How We Overcame Challenges and Improved Our System
We started using Google Sheets for accounting, which was challenging since it wasn't anyone's forte. However, we eventually found software to handle our HOA accounting. Five of the six of us have board positions: President, Vice-President, Secretary, Treasurer, and Maintenance. The maintenance person isn't necessarily the handy person in charge of fixing problems. They are just the point person for issues and disseminating information. One key thing we implemented was a Felton Heights email account. It's an email account that everyone has access to, so they can also access the shared drive where we store important documents such as articles of incorporation, vendor info, annual budget, insurance info, meeting notes, and CC&Rs.
We now have an owner with accounting experience who balances our checkbook every month. We also have Zoom meetings every three months to cover any problems that might crop up. Two of our owners are now renting out their units, so the Zoom meeting is ideal.
The city is good about telling you when they need something from you, as well as the vendors who notify us about our annual fire extinguisher check and backflow testing. We figure things out along the way.
Saving Money and Feeling Accomplished
While self-management has required more work and communication between the members, it has saved us $6000 annually in management fees. We are proud to say that we put on a new roof that was sorely needed. Getting the quotes, approving everything, arranging the workers, replacing the skylights in four units, and ensuring everything got done was a little scary. After that was accomplished, we felt like we were a success.
Future Challenges and Lessons Learned
Of course, there are still things that worry us. We still worry about potential issues, such as missing new laws that may result in fines. Also, our HOA doesn't have a business address, and all the mail comes to one person on the board. Our HOA phone number is my cell and our President's cell phone. So we will have to change our HOA address if this board member moves.
In conclusion, our experience of self-managing our HOA has been challenging but rewarding. We hope other HOAs can learn from our experience and make the best decision for their community.
Reflections on Our Self-Management Journey
Despite these concerns, I am proud of what we've accomplished. Our self-management journey has been challenging, but we've grown stronger as a team. We hope our experience will inspire other self-managed HOAs to share their stories. We look forward to learning and growing together.
Footnotes & References
- California Legislative Information. Davis-Stirling §4090 "Board meeting" defined.
- Cornell Law School Legal Information Institute. California Code Regulations Title 19 § 575.1 - Maintenance and Required Service Intervals.
Another source: California Department of Forestry and Fire Protection. Office of the State Fire Marshal Fire Engineering & Investigations Division. Fire Extinguisher Law & Regulations. October 2014 Edition..
(More stringent local provisions may apply)
- The City of San Diego Public Utilities. Cross-Connection Control and Backflow Prevention FAQ.
If Your HOA Needs Help
If you're interested in transitioning your HOA to self-management or looking for HOA management software, contact reTHINK HOA. We provide guidance and support based on our experience helping other HOAs. reTHINK HOA can help you determine the best option for your community.