Falls Church, Va., March 13, 2023 (GLOBE NEWSWIRE) — Residents living in condominiums, homeowners associations, and housing cooperatives could be facing increased assessments due to growing operating costs and expenses. According to a new survey by the Foundation for Community Association Research, 91% of community association managers, professionals, and homeowners surveyed report they are seeing unexpected increases in expenses due to rising costs and inflation.
Released today, the Foundation's "Rising Costs in Community Associations" survey is the direct feedback from international community association board members, managers, and business partners"" including accountants, reserve study professionals, and service providers.
According to survey respondents, management fees (92%), insurance premiums (91%), maintenance services (85%), staffing (74%), landscape services (72%), and reserve funding (64%) are the areas with the largest increases in costs.
When asked how they planned to address the unexpected costs, 73% of respondents report they plan to raise assessments, while 41% say they plan to reduce expenses, and 15% will lower their reserve funding contributions.
Forty percent of survey respondents plan to defer maintenance projects, and 31% are reducing landscaping programs, while 18% plan to reduce legal fees, and 14% will reduce community amenities. Renegotiating contracts, prioritizing projects, investing in energy efficiency, special assessments, utilizing contingency funds, and exploring bank loans are other efforts being considered.
As inflation continues to drive up material and supply costs, 87% of community association management companies say they plan to increase their fees this year, and 39% of these companies say their bids and proposals for community association services don't expire.
The report further outlines best practices and considerations for communities when forecasting a financial plan, including current inflation conditions directly impacting condominiums and homeowners associations.
"As we witness inflation's impact on the housing market, the results give us a better understanding of how these economic factors are challenging residents and the professionals who serve condominiums and homeowners associations," says Dawn. M. Bauman, CAE, executive director of the Foundation for Community Association Research. "The new survey will be a valuable resource for communities needing to fulfill their fiduciary responsibility to homeowners while determining what products, services, and programs move forward."
Media Contact:
Amy Hawkes Repke
Vice President, Communications & Marketing
arepke@caionline.org | (703) 624–2179
Dawn M. Bauman, CAE
Senior Vice President, Government & Public Affairs | Executive Director, Foundation for Community Association Research
dbauman@caionline.org | (703) 867–5588
About the Foundation for Community Association Research
Our mission""with your support""is to provide research–based information for homeowners, community association board members, community managers, developers, and other stakeholders. Since the Foundation's inception in 1975, we've built a solid reputation for producing accurate, insightful, and timely information, and we continue to build on that legacy. Visit foundation.caionline.org.
About Community Associations Institute
Since 1973, Community Associations Institute (CAI) has been the leading provider of resources and information for homeowners, volunteer board leaders, professional managers, and business professionals in the more than 358,000 homeowners associations, condominiums, and housing cooperatives in the United States and millions of communities worldwide. With more than 44,000 members, CAI works in partnership with 36 legislative action committees and 64 affiliated chapters within the U.S., Canada, South Africa, and the United Arab Emirates as well as with housing leaders in several other countries, including Australia, Spain, and the United Kingdom. A global nonprofit 501(c)(6) organization, CAI is the foremost authority in community association management, governance, education, and advocacy. Our mission is to inspire professionalism, effective leadership, and responsible citizenship""ideals reflected in community associations that are preferred places to call home. Visit us at www.caionline.org, and follow us on Twitter and Facebook @CAISocial.
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