The start of a new year always inspires change, and the idea of partnering with a new HOA management company is no exception. While January 1st doesn’t have to be the automatic deadline for shifting direction, there are a few factors to assess if you’ve been thinking a change may do some good.
Typically, when board members consider a switch in management, it involves consistent problems with at least one of the following:
- Unresponsiveness of management team
- Lack of accountability or follow-through
- Incomplete or incorrect financial statements
Every community board of directors and HOA management relationship has its own nuances and complexities to manage. However, the ultimate question to ask before hiring a new team is: Are the current problems too big to overcome? When the answer is a resounding yes, it’s time to explore alternatives. Here’s what to know as you plan for change.
1. Be prepared
It takes thoughtful planning and careful execution to achieve success. It’s not as simple as changing cable providers or upgrading to the latest smartphone technology. Rather, it’s a transition of a multimillion-dollar corporation and the management of potentially hundreds of homes, numerous amenities, and common areas to a brand-new property management company. Multiple steps and careful preparation is in order.
Make sure you’ve advised your current HOA management company of the unresolved issues and give them time to fix them. Should the problems continue to persist and the board is still aligned on the commitment to move forward, then take the steps necessary to vet new options. Also, take into consideration the effect a switch will have on members.
Though hiring new HOA management may be in the best interest from a board perspective, if it’s not properly communicated to its members, it won’t be received that way. Be prepared to communicate the reasons behind the change and to address resident questions as you create a seamless transition for everyone. This will include providing new contact information, account and bill pay access, and time for members to adjust to a new system.
2. Set a plan
Once prepared for how to handle communication, establish benchmarks according to an agreed-upon timeframe and budget. As a board, decide the level of service desired going forward and how it works into the current budget. Consider if an increase in service levels would also mean an increase in dues for members and if the end justifies the means.
Also setting a plan of when to make the move must be based on what’s outlined in the current contract. Review the termination clause, which specifies how much notice is required to give your current HOA management company. In some cases, it’s 30 or 60 days, while other contracts may only offer a non-penalty option once a year.
Compare this timeframe with the property’s annual calendar to see if there’s a conflict with any major projects, elections, or any other events that may hinder the move. As with any significant change, timing matters. Align yours to what causes the least disruption and best benefits the community. The longer you have, the smoother the transition will be.
3. Ask the right questions
Part of preparation and planning involves ensuring there’s enough time to perform due diligence. Consider bids from at least three HOA management companies and ask questions like:
- Are they local? – It’s best to choose a management company with an intimate knowledge of local vendors, demographics, and laws. Make sure they are equipped with the experience, resources, and expertise of conducting business in your state.
- What is the quality and reputation of their vendors? Reliable vendor relationships make a difference in maintaining high property values and member satisfaction. Additionally, some companies may only work with their preferred vendors. Asking specific questions about how a management company selects its vendors can give meaningful insight into its reputation and ethics. Assess potential restrictions or red flags that could cause problems in the future.
- How dedicated is the management team? Ask each company how many accounts their managers handle individually and how many homes are under each account to determine the time and attention they’ll be able to provide you. Also, ask if managers are certified. Though the company itself may claim certification, each manager may not have the same qualifications.
- What kind of support level do they have at the corporate level? In addition to your assigned account manager, are there supervisors, assistants, departmental support, and customer care available to help in a timely way with onsite matters? Additionally, do they have a transition team that assists with the smooth and timely transfer assets and information?
- How advanced is their technology? Especially when upgrading HOA services, ensure the new company has modern capabilities people expect today, such as email communication, member portals, and online payment options.
Preparation, planning, and getting all your questions answered will help you narrow down your choices and allow you to feel confident when selecting your next HOA management team. From there, you’ll be well on your way to creating a lasting, positive impact on your community.
At Keystone, we’re dedicated to showing homeowners there’s a better way to HOA. Interested in learning more about our services? Contact us today to get the conversation started.