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“Can you just stop raising assessments?”
Whether you’re a board member for a high-rise association in Las Vegas or a single-family home community in Reno, you’ve likely heard this request more than once. And truth be told, there are often valid reasons to raise assessments (in fact, keeping assessments low regardless of your maintenance needs can actually hurt your community’s property values and relevance). But no HOA board wants to be the “bad guy.” So before you take the step of raising assessments, consider these four cost-saving strategies.
To take an in-depth look at these strategies, read the full article
Cost-Saving Strategy #1: Energy
Energy costs are clearly on the rise in Nevada and across the country. That’s why it’s beneficial to partner with your community management company to look for areas where you can increase energy efficiency and consequently save money. For instance, if lights are consistently left on in unoccupied areas, you may want to install light switches on motion detectors. And for a long-term savings solution, consider replacing all traditional lighting with LED lighting (if you haven’t already). It may require a larger upfront investment, but it will likely save your HOA money in the long run.
Cost-Saving Strategy #2: Reserve Fund Investments
It turns out most board members aren’t sure if they’re getting the best returns from their reserve fund investments. In our 2018 HOA Budget Survey, 72% of board members said that they weren’t fully confident in their returns on reserve funds and/or operating funds (get the full survey results here
). Review your current investment plan with your HOA management company and financial services provider to see if there are opportunities to increase your investment returns. To learn more, read “[Reserve Funds] Six Ways to Improve Association Returns”
FirstService Financial partnered with a large single-family home association in Las Vegas to help increase their annual interest by over $30,000 (representing 268% improvement).
Cost-Saving Strategy #3: HOA Insurance
Have you reviewed your HOA’s insurance coverage recently? If not, you may be paying more than is needed in premiums and/or deductibles. Partner with a trusted insurance agent or broker who has experience with community associations and can work with yours to get the best rate. To learn more about the complexities of HOA insurance, download our complimentary white paper: 4 Things You May Not Know About Community Insurance
Cost-Saving Strategy #4: Vendor Contracts
In the 2018 HOA Budget Survey
, more than 57% of surveyed board members said they weren’t sure if their management company asks vendors whether there will be cost increases in in the next year’s budget. However, if you and your management company are not reviewing contracts regularly, you may be missing out on valuable cost savings. Partner with your HOA management company to communicate with vendors consistently in order to reveal potential savings.
Other Cost-Saving Strategies: HOA Investment Policy
These four cost-saving strategies are a great starting place, but there are certainly other areas to consider as well. For example, a good way to find additional cost savings in your investments is by creating an HOA Investment Policy. You can use an HOA Investment Policy to help you find better returns on your reserve funds, potentially helping you save money in the long run. To learn more, download How to Create an HOA Investment Policy
Get a free white paper
Want to find additional cost savings for your association? Complete the form below to read the full article and download our free white paper, 4 Things You May Not Know About Community Insurance