When you live in a planned community with several different families and various amenities, expenses are natural to occur. Every HOA has a budget, according to which all the funds are spent. Everyone wants to save money; however, a sudden increase in expenses can often upset some homeowners.
To keep the HOA expenses in check, the board should evaluate its budget and make sure that they are handling the finances correctly. Since finances are complex and can be mishandled by the untrained, communities often hire Scottsdale HOA management companies to review and fix their budget.
Ways To Reduce HOA Expenses
Review Your Budget Frequently
It is essential to keep reviewing your HOA budget to make sure that you are not blowing money on things that are not necessitated at the moment. This happens in cases of maintaining the aesthetics of the HOA. For example, renovate the clubhouse, paint the gym, or do other refurbishing projects later if the money is tight. However, replacing the broken pool tiles, repairing leaky roofs, etc., cannot be postponed.
Review Vendor Contracts
To reduce your HOA budget, you need to take a look at vendor contracts as well. The vendor contracts are responsible for tasks like mowing your lawn and installing new windows in community areas. If your vendor contract costs your association more than you can afford, you need to make a few adjustments. Consult your vendor contracts and ask them to find ways to lower the price. Remember that the market is competitive. If your vendor is unwilling to lower the cost, other vendors may do the same work at reduced prices.
Use More Technology
Technology saves both time and money. If your HOA sends notices and announcements by printing and mailing them individually to people’s homes, it is time to go paperless and use the digital mode of communication. Along with being time-saving and cost-effective, it is also environmentally friendly.
Outsource Back Office Duties
Handling the finances and entire community budget where so many people live together can be challenging at times. There are various duties such as administrative work, vendor contracts, maintenance, fee collection, and more. These services will have their individual costs. Hiring a single management company that will do all the work for you instead of employing different people may be a more cost-effective option.
Things To Keep In Mind
When reducing costs, keep four things in mind.
- Make an annual budget and review it every month.
- Talk to the residents and be open to suggestions.
- Prioritize the community’s needs.
- Create a strategic plan.