Mark Burns is Associate Professor in the Department of Political Science and former Director of the Health Administration Program at Auburn University.
HOA fees are based on a variety of things. The management association bidding to run an HOA determines the hard costs of things like utilities, landscaping, pool maintenance, administrative costs like attorney fees, billing and postage plus any other required overhead.They then add on their profit margin for servicing the account.he management association bidding to run an HOA determines the hard costs of things like utilities, landscaping, pool maintenance, administrative costs like attorney fees, billing and postage plus any other required overhead. They then add on their profit margin for servicing the account.
Many condos and townhomes -- both new construction and existing properties -- impose a capital contribution (sometimes called an initiation fee) on new owners. This is a one-time, nonrefundable fee paid by the buyer at closing.Once collected, the capital contribution is deposited into the HOA's reserve fund, which serves as a savings account for the property. The capital contribution rate is set by the HOA, but it is typically equal to two months of HOA dues.o if the monthly HOA fee is $250, the buyer would need to bring an additional $500 to the closing to cover the capital contribution fee. Move-In Fee. Prior to moving in, new residents of a condo or townhome may be required to pay a move-in fee.