SHARE

Property Owner’s Association: COA, HOA, POA, What's the difference?

Some homebuyers refuse to purchase a property if it is part of a property owner association. On the other hand, many other homebuyers intentionally seek out properties that are part of a POA because they find that there are many benefits associated with a property owner association.

But what exactly is a property owner association? And why do some people hate them while other people love them? We’ll be covering everything you need to know about POAs in greater detail below!

What Are Property Owner’s Associations?

Let’s start with the basics. What is a property owner’s association? Well, a property owner association will cover a wide range of property types, including condos, single-family residential homes, townhomes, and possibly even commercial property.

A property owner’s association will oversee various rules and regulations regarding property management. Some of these rules and regulations include zoning restrictions, approving new developments, denying certain updates, and protecting the long-term real estate interest of a specific area.

This area can be a neighborhood, a part of town, or even a few different areas simultaneously! When you hear the term property owner’s association, envision an HOA but on a larger scale.

What is an ROA?

An ROA is a real estate acronym that applies to residences. The acronym stands for residential owner’s association, and an ROA functions just like a property owner’s association.

Purpose of a Property Owner’s Association (POA)

A property owner’s association has numerous purposes. Some of the most common purposes include protecting the value of properties in a specific area and maintaining common areas of the neighborhood or community.

Protecting the value of properties in a specific area is a major focus of a POA. You might be wondering how a POA protects the value of a property, and it all comes down to the rules and regulations put into place.

For example, POAs ensure that all the lawns are mowed regularly and that bushes do not grow to a point where they are out of control. They also ensure that homeowners don’t store junk in their front yards, like old mattresses, appliances, or inoperable cars.

A homeowner is required to maintain the exterior of their home as well if they live within a POA. For instance, if the siding of the house is falling apart or the gutters are hanging off of the home, then the POA board will step in and enforce the rules already in place.

In addition to protecting the value of the properties within the community, the POA board will also maintain common areas. Plenty of communities come with added benefits, like pools, club houses, parks, trails, basketball courts, or tennis courts, among other types of common areas. A POA board will oversee all of the common areas and amenities in a way that keeps the grounds looking like a luxurious resort!

Many homeowners appreciate the level of security that a property owner’s association can provide. If you take a lot of pride in your home, the last thing you’ll want is to live near someone who doesn’t feel the same about their house.

Your neighbor's property can drastically decrease the value of your home as no one wants to live near people who neglect the upkeep and maintenance of their home. So, if this is important to you, then you might find a POA to be very appealing.

Homeowner’s vs Condo Owner’s Associations

Earlier, we mentioned another common real estate acronym known as HOA, but there’s also COAs, too. HOA is short for a homeowner’s association while COA is shorthand for a condo owner’s association.

What is an HOA?

A homeowner’s association is in charge of overseeing a specific neighborhood or community. The homeowner’s association is a governing body that oversees the aesthetics of the area.

If you purchase a home within an HOA community, you will need to pay HOA fees that need to be paid either monthly, quarterly, bi-annually, or annually. These fees typically range from $100 to $300 per month depending on the amenities that the specific HOA provides.

What is a COA?

A condo owner’s association, or COA, is effectively the same thing as an HOA but it’s for condominium complexes instead of neighborhoods full of houses. Even so, many condo associations use the term HOA as it is more widely known and understood than COA.

What Does an HOA or a COA Do?

Homeowner associations protect and enhance the value of properties by enforcing various exterior facing rules. Examples of HOA rules include the following:

  • All lawns need to be cut and maintained.
  • The exterior of a home cannot be falling apart or neglected.
  • Homeowners are only allowed to paint their home, or front door, a specific color.

In addition to enforcing the rules, a homeowner’s association will also maintain common areas. Unlike a POA, an HOA is for a specific neighborhood or community.

HOA vs POA: The Key Differences

So, what exactly is the difference between a homeowner’s association and a property owner’s association? Let’s view both of them side by side!

 

Property Owner Association 

Homeowner’s Association 

Span of view?

Numerous neighborhoods, sections of a town, commercial buildings, and residential buildings

Oversees a specific neighborhood or community

Membership

Mandatory or voluntary depending on the area

Mandatory or voluntary depending on the area

What is the main goal?

Community planning and long term value of the properties or specific area

Protecting the value of homes within the community

Scope of view?

POAs are concerned about aesthetics as well as zoning and planning

HOAs focus on aesthetics and rule enforcement

Dues and fees?

Dues and fees are required

Dues and fees are required

Fines for noncompliance?

A POA can fine a property for not complying with the agreed-upon rules or standards

An HOA can fine a property for not complying with the agreed-upon rules or standards

Who are the board members?

Property planners and various homeowners within the designated area

Board members are elected within the community 


Protect Your Assets

Oftentimes, purchasing a property is the largest purchase you will ever make in your life. When you purchase a home within a property owner’s association, a homeowner’s association, or a condo owner’s association, you are protecting your biggest asset.

You don’t want to purchase property that is projected to depreciate over time. Buying property within an HOA, a POA, or a COA ensures that your property will only appreciate as time goes on, which is the ultimate goal! Buying a property within one of these communities helps you have more control of something that you typically wouldn’t be able to control.

The governing body will ensure that all of the homes within the community are well-maintained and remain in compliance with the agreed-upon rules and regulations. You’ll never have to worry about living next to someone who has overgrown bushes or detached gutters among any other home-related issues. This protection keeps the value of houses high while making the neighborhood feel brand new even years after it was constructed.

 

Let's Get You Into a New House!

All material is presented for informational and educational purposes only and should not be construed as individual financial, investment, or legal advice or instruction. ZeroMortgage does not guarantee the quality, accuracy, completeness or timelines of the information in this publication. While efforts are made to verify the information provided, the information should not be assumed to be error free. Some information in the publication may have been provided by third parties and has not necessarily been verified by ZeroMortgage. ZeroMortgage, its affiliates, and subsidiaries do not assume any liability for the information contained herein, be it direct, indirect, consequential, special, or exemplary, or other damages whatsoever and howsoever caused, arising out of or in connection with the use of this publication or in reliance on the information, including any personal or pecuniary loss, whether the action is in contract, tort (including negligence) or other tortious action. ZeroMortgage does not provide tax advice. Please contact your tax adviser for any tax related questions.

This page last updated: March 21, 2022