Cohousing-L Mailing List: Re: Rate of increase in HOA Dues?

[jpustell [at] verizon.net (jpustell]

Ceil -
You raise an interesting issue with rapidly rising insurance premiums.  Here in 
the Boston area we've seen 15% to 20% annual increases in the last 2 years (at 
my condominium)
I've been told it is happening to us all (HOA's that is)
I did find an interesting analysis for the market in MN that really tells the 
tale.  In MN HOA's have seen a 90% increase in master policy premiums over 3 
years.  
https://www.lcc.mn.gov/cichoa/meetings/20241126/HOA-Insurance-Survey-Results
They also talk about the reasons.  Though it is a MN only analysis - to me the 
issues they raise probably affect all 50 states.
There is no magic bullet listed in the article - but at least it provides some 
independent support you can send your members about why the policy costs are 
going up so much.
I do agree with the recommendations I've seen:1) Make sure NOT to drop your 
coverage limit - it is importnat to carry a high enmough limit., and2) Do 
consider a higher deductable coupled with making sure your unit owners have 
enough coverage in their HO6 policies to cover that deductable for damage to 
their units.

John Pustelljpustell [at] verizon.net
 

    On Friday, April 4, 2025 at 08:17:27 AM EDT, Ceil Malek <cfrenchmalek [at] 
gmail.com> wrote:   

 Our community, as many others do, faces sharp increases in insurance rates,
and in addition, we're trying to respond responsibly to a reserves study
recommendation that we "catch up" to fund reserves at 100 percent of the
company's recommendation, which means increasing HOA dues significantly
(10-14 percent, not for a single year but for five years running). Nobody
in our community questions the wisdom of funding reserves adequately.  What
we are discussing is the timetable for increases and the way the
accumulation of increases impacts dues.

I have several questions of other communities:
1.  Do you aim to fund reserve fund recommendations at 100 percent?  70
percent?  Some other rate?  How do you determine what's responsible?  Our
community of 34 homes is about 20 years old.

2. Are you facing increases in insurance?  What are they? How are you
accommodating increases in insurance rates and reserve study
recommendations as well as ordinary expenses in your community?

3.  What percentage of your community needs to approve your budget?  How do
you address homeowners for whom a considerable increase (10-14 percent
increase each year for five years) in dues  creates a challenge?

4.  How do you manage the inevitable tension between wanting to keep HOA
dues reasonable and needing to respond to the rising costs of
maintenance and insurance?

These are big questions.  We're trying to navigate complex circumstances.
Putting our decisions in the context of how other communities are
responding would be helpful.  Feel free to respond to some of the questions
and not all.  I realize I'm asking a lot.

Ceil Malek
Casa Verde Commons
Colorado Springs, CO 80907
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