7 Differences Between HOAs and Property Management Companies

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7 Differences Between HOAs and Property Management Companies 3

Your rental property could have both an HOA and a property management company. The two entities are very different things. But without a good understanding of the role of an HOA versus a property manager, it’s easy to get confused about what they do or how they work together. 

Using a property manager to make the most of your rental property is an excellent way to go. When your property is in an area also governed by an HOA, it’s critical to make sure your property manager understands the HOA rules and how to comply. 

A homeowners association can’t take the place of your property manager. Let’s take a look at the seven key differences between a homeowners association (HOA) and a property manager. 

1. HOAs are Community Rule Makers

What is an HOA? A homeowners association helps enforce community rules for a neighborhood or a group of homes. These rules can include a variety of things, from aesthetics to how to behave as part of the community. 

When purchasing a rental property in a community with an HOA, be sure you check into the requirements. Are there rules about:

  • The color of your property?
  • Landscaping?
  • Decorations?
  • Quiet hours?
  • Having pets? 
  • Using common areas? 

Make sure you and your property manager understand all of the rules to stay in good standing with the HOA. Your property manager is your “in the field” representative to make sure your property stays within the rules. Your property management company must also work with your tenants to make sure they live in your property within the provisions of the HOA. 

2. HOAs are Rule Enforcers

Depending on your type of HOA, they can enforce rules that your property manager can’t enforce. 

If your property or your tenants fail to comply with the HOA rules, some HOAs can legally apply a lien on your property and assess fines to you as the property owner. While your tenants are acting in violation, as the property owner, you’re responsible for making sure they follow the rules. 

Use your property manager to help keep your tenants within the rules. While your property manager can’t legally assign a lien to your property, they can asses fees to your tenants for rule violations. Make sure your lease agreements include penalties for violating HOA rules. This gives your property manager flexibility to enforce rules that support the HOA guidelines.

3. Property Managers Don’t Manage Common Spaces

Depending on your type of property, your property manager won’t manage common spaces within the neighborhood. Parks, swimming pools, and walking trails fall under the responsibility of your property’s HOA. 

Your property manager focuses on your property. You need them to help you provide a habitable home within Virginia’s landlord-tenant laws while also following your HOA rules. 

4. HOAs Don’t Manage Your Property

Your property’s HOA will provide a list of rules for all properties to following within the neighborhood. However, they won’t manage your property for you. Some HOA boards might hire an HOA management company to enforce the rules. However, HOA management is not the same property management for landlords. 

Find a trusted property management partner who understands your financial goals and works for you—in compliance with your HOA.

Your property manager should:

  • Find and screen quality tenants
  • Provide maintenance services
  • Regularly inspect your property
  • Collect the rent and make sure you get paid

When you have a property manager acting on your behalf, you won’t need to worry about your home or tenants following the HOA rules. 

5. Property Managers Care About Owner Interests

We mentioned your financial goals. Your property manager works to make sure everything about your property supports your interests as the landlord. 

Your HOA’s primary concern is for your property and anyone who lives there to “fit in” to the neighborhood. In many cases, HOA boards are rental friendly as long as your property follows the rules, and your tenants don’t disturb the neighborhood. 

When choosing your property management company, make sure they understand how to screen tenants who will help your property remain a valuable asset to the HOA community. With regular property inspections, your property manager will keep your property’s condition and appearance in-line with your HOA guidelines.

You don’t want to be “that” property with the tenants that suddenly painted your property a color that isn’t HOA-approved. Your property manager’s job is to make sure anything that happens with your property supports your goals and follows the HOA rules. 

6. Property Managers Follow HOA Rules

If your HOA requires annual fees, your property manager makes sure those fees or dues roll into the monthly rent for your property. It’s your property manager’s job to make sure tenants understand and follow the HOA and lease rules. 

However, your property manager can’t do anything with your property or your tenants that violates landlord-tenant laws. Make sure you choose a property manager who will maintain a good relationship with your HOA and your tenants. 

7. Property Managers Are Your Rental Property Experts

Your property manager sets you up for success. Starting with rental property analysis, your property manager sets the best rental price to attract the right tenants for your rental home. With quality tenants and the best local property manager in place, your HOA will love having you as a rental property owner in the community. 

Property Managers and Your Homeowners Association Work Together

The best property managers know how to work with a homeowners association to make sure you get the most from your rental property. Nomadic Real Estate is the property management company you need to navigate your property, the HOA, and your tenants for success. 

Contact us for a free property management quote today! 

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Your portal includes a selection of extremely useful reports. Reports are available in the “Reports” section, and are distinct from the financial statements. Unlike financial statements which are static records, Reports are dynamic real-time records that will update with current data every time you view them. 

Scroll down to learn more about Reports:

Navigate to the "Reports" module in your portal:

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Enhanced Rent Roll Report:

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Unit Comparison Report:

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Income Statement Month-Over-Month:

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Financial Statements

Financial statements will be published to your portal on a monthly basis. The statements are found in your Documents library, and provide a historical record of all financial performance. The statements serve as a snapshot of financial performance over a given period, and are static documents (unlike Reports, the statements do not update/change in real-time). 

Scroll down for more info about the Financial Statements in your Documents library:

The Documents area contains monthly financial statements:

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Download a statement to see month and YTD financials:

You'll also find a month-over-month operating statement:

Portal Communication Tool

You can use your owner portal to communicate with our team. Any messages you send through the portal will go straight to your Account Manager. When we reply, you’ll get an email notification and you’ll also see the message in your portal next time you log in. 

Here’s an overview of using the communication platform:

Click "Communications" and navigate to "Conversations":

  • The communications module will contain a record of all messages that you create through the portal. 

Click the "New Message" button and send your message:

Responses will show up in the conversation ticket:

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You can reply in-line using the comment box:

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Understanding the Ledger

Your portal includes a ledger with all transactions. The ledger is populated with data in real-time as transactions flow through our accounting software. Much of this information is also available in the Reports area, as well as the Statements in your Documents library, but the ledger is the most comprehensive resource for diving into the details. 

Please scroll through the sections below to get a better understanding of how to interpret the ledger. 

By default, transactions are sorted chronologically:

  • The date reflected in the lefthand column is the actual transaction date, not the “bill date”. This is the date the transaction was actually processed. 

If you have multiple properties with Nomadic, you'll see the address for each transaction in the "Location" column:

  • You can filter the ledger to look at just one property, all properties, or specific sets of properties. 
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The Description column displays the transaction type:

  • BILL: this is an expense transaction, such as for repair costs or management fees.
  • CHARGE: this is a transaction  billed to the tenant, most typically a rent payment. 
  • NACHA EXPORT: this is a credit we processed to your distribution account. This type of transaction is how you get paid! 

The Amount column shows the dollar value of each transaction:

  • Positive Amounts: if an amount is positive, it reflects a transaction that is payable to you. Typically, this will be a rent payment that we collected from your tenants. On occasion, a positive number could also signify a journal entry or credit adjustment. 
  • Negative Amounts:  if an amount is negative, this is a transaction that is either payable to Nomadic or is an amount that has already been paid to you. Typically this will be for repair costs or management/leasing fees. Owner draws (net distributions into your checking/savings account) also reflect as negative amounts, since they have already been paid to you. 

The Account Balance column shows a sum of positive/negative transactions at a given point in time:

  • Account Balance should always equal zero after a net distribution has been processed. When the balance is zero, this means that all expenses have been paid and you’ve received the remainder as net operating income, leaving a balance of zero (meaning: no one is due any money, as all funds have been distributed appropriately). 

Navigating the Propertyware Owner Portal

Your portal includes some extremely useful features that help you understand your property’s financial performance at a new level, with real-time transparency into every transaction.

Scroll through the snapshots below for an overview of portal navigation! If you need more help or have specific questions about using the portal, you can reach out to your Account Manager any time for a screen share. 

You can filter all info by date range or property:

View a snapshot of income and expenses on your dashboard:

See every transaction in real-time on your ledger:

Statements and forms will be posted to your documents library:

View a suite of real-time financial reports:

See a running list of all bills, and drill down for more detail:

Under Bill Details, you'll find dates/descriptions/amounts and more:

You can also communicate with your Account Manager through the portal:

How do net distributions work?

Net distributions keep your accounting clean and simple. Each month we’ll collect rent from the tenants, deduct any repair expenses for the previous month and any management/leasing fees for the current month, and credit the remaining net operating income to your account. 

You’ll receive a statement via email each time a net distribution is processed, and can view all transaction details in your Propertyware owner portal.