Community Associations

A community association is governed by a defined set of rules and regulations; these are commonly known in the context of a community association as Covenants, Conditions, Restrictions, By Laws, Rules and Regulations. Each and every member of the community association is governed by these and they are compelled to abide by these. In effect the association acts as a regulatory body and acts in the interest and welfare of all its members, who have joined by virtue of their capital asset being their home, within the community.

The community association has enjoyed significant growth over recent times. This can be attributed to the fact that most civic authorities have stipulated the formation of these associations by communities, as well as when a new development is underway the land developer is required to establish such an association. In the United States alone, the amount of registered community associations were nearly ten times the amount of local governments in 2008, counted at over 300,000 community associations across all states.

One of the key areas, and possible difficulties in a community association is that because of all the members of the association, there is bound to be an amount of differing opinions on the best interests and enforcement of the regulations for a community. Hence the establishment of a board of directors for the association is vital, in order to maintain a smooth and efficient operation with respect to the well being of the community as a whole.

Forms of the community association can vary, it can be a Condominium or a Planned Community Association. Within the defined areas of the association there are normally areas known as common areas, which is used by all residents or members of the community association. Dependent on the areas deemed to be common areas, as defined by the particular association, will normally determine the amount of monthly or annual fees payable to the community associations. These fees are more often than not referred to as assessments, and are payable for the upkeep and maintenance of the defined areas. The so called limited common areas are normally the responsibility of the owner or occupant of each unit or residence.

The assessment mentioned above has various ‘roles’ in that it is used for the regular upkeep of the common areas, and in certain cases an amount is set aside for future, and major, capital expenditure as well as any agreed upon projects that will benefit the community. The role of the board of directors is to effectively manage the assessments due and paid, as well as trying to keep this as low as possible, whilst also providing value to the community which in turn stands to enhance the value of the individual houses and or units, as well as the community as a whole.

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