While you might not be interested in The Odeon per se, you just might be interested in our readers’ insights regarding HOA fees in general. Feel free to join the thread (or start afresh right here).
The Kind Of Email We Love To Get (And An Odeon Question) [SocketSite]

Comments from Plugged-In Readers

  1. Posted by Anon

    Yikes – took a while to read down past all the “discussion” about parking spaces to reach the HOA part, but there were some good points there. What I’ve found is that the only time the size of a development really affects the HOA cost is with the door-man/live security element. If you have less than 100 units and a full time door-man, that will make your HOA costs go up noticeably. Each security person is going to cost you in the range of $60-$80K annually once benefits are added in and you are going to need 3-4 shifts to cover 7 days a week, 24 hours, so that is $250-$300K added on to your HOA budget right there. With hundreds of units, the hit per unit is not so much, but with less than 100 units, it is going to be over $200 per month. In fact, that’s a major distinction in the Manhattan condo/co-op market and the $200 per month difference is pretty common. As far as earthquake insurance making up a large cost in HOA fees – that is the dirty little secret of the real estate market around here – it is very expensive to have earthquake insurance and most of the time it is not included (unless it is explicitly stated that they do). A 10/06 article by insurance company A.M. Best indicated that only 12% of Californians have earthquake insurance, so that’s a pretty good guess for how many condo associations have it. A lot of times when it is in place, a lender will require it (rightly so) but oftentimes the cost is too much of a deterrent for people to pony up for it. Not only that, but while earthquake premiums went down a few years ago, they are now headed way up after insurers have re-adjusted their risk models from the Katrina disaster. So those are two big HOA costs which can be variable (security and earthquake insurance) and cause your fees to go up or down pretty noticeably. Lastly, one of the main reasons why a high rise HOA is higher than a small low-rise development is the cost of the elevators – maintenance and power for those big and fast elevators does not come free.

  2. Posted by SeeHsee

    Anonymous at 11:55 AM…
    I echo your assessment (no pun intended). As I mentioned in posts on the other thread, less apparent, non amenity-related factors are usually those that determine fees the most. You’re right, elevators, staff people and earthquake insurance are usually at the top of the list. Amenities are usually put in at the developer stage–a cost they bear to help sell the building. Once they are in, subsequent homeowners bear the expense of maintaining them. That doesn’t come cheap, either, but it’s usually not what makes dues high or experience a sudden increase.

  3. Posted by Anonymous

    So my question is in the long run is it better to buy into a project with a large number of homeowners? Would an owner in smaller developements such as The Odeon be at risk to large assessments when repairs come due? I still cannot imagine what the HOA of $600 a month is going to at the Odeon, but I did not realize until looking at the other thread how high the cost of earthquake insurance had risen.

  4. Posted by Anon

    You’re probably a bit safer in a larger development from big hits from special assessments, but it’s more of a building by building problem rather than a large versus small problem. State law requires a budget and a reserve account for homeowners associations, so baring unusual events, the normal monthly fee should take care of maintenance on the building. Special assessments are more common in older buildings which didn’t budget adequately or foresee unusual capital expenditures. Also, remember with a new building or a renovated development, the developer is on the hook for 10 years to ensure their building is free from construction defects. So newer developments have an added layer of protection against unusual special assessments. That being said, I read the SFgate article recently about the monthly fees increasing dramatically at 333 Grant – anyone know why?

  5. Posted by SeeHsee

    The article cited two reasons. First, the homeowners had made decisions that increased costs, such as extending the hours of lobby security to 24 hours a day. Second, the article suggested that the actual operational/maintenance costs simply had not been accurately estimated, and that it took some time to finally get them right.
    “in the long run is it better to buy into a project with a large number of homeowners?”…
    Two things that I think make larger condo developments better from a dues-stability standpoint. First, usually they have more extensive professional management–not just homeowner volunteers trying to do everything. Second, more units among which any hits or assessments can be shared. However, the biggest determining factor is how a building is managed, large or small. That’s why it’s critically important before buying to study the history of the association’s meeting minutes, contact the management company and ask about any notable issues, and maybe even speak to board members.

  6. Posted by Jo

    I live in an 85 unit condo in SOMA. My HOA dues are $610. We have no gym, no pool, no BBQ, and frankly NO amenities.
    We do get a daily cleaning person for the common areas and door people for about 14 hours a day. Is this not ridiculous? I feel like I am being ripped off. Most other condos in the same area at least provide owners with amenities for that cost, we get nothing?

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