Fund Reserves by Cutting Your HOA budget In These 4 Areas

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Barrera and Company specializes in Reserve Studies that help communities protect their property value by planning for the future. Our reports make it easy for HOAs to set realistic budgets that combat against the dreaded special assessment. This alone is a necessary first step. But, we highly recommend taking a good hard look at your expenses as well. We help Associations determine what needs to be set aside but, at the end of the day, they have to find the funds. The good news is that there are always pennies to be pinched (and reallocated towards reserve funds!)

Here are a few ideas:

1. Consult with your insurance agent

Insurance is probably your Community’s largest expense. It’s extremely important that you have the right coverage in place for the right price. The insurance world is in constant flux and is best understood by your local agent. At the very least, do an annual review with your existing agent. With an expense this large feel free to do some annual shopping around as well.

2. Take a look at utilities 

This is probably your second largest expense so it pays (literally) to keep an eye on it. The lowest hanging fruit here is your bill. Keep an eye on it for major rate hikes and/or spikes in usage. Feeling a little more proactive? Great! Check out local rebate programs for energy and water efficient retrofits. You might be able to upgrade to low flow toilets, and LED lighting for little to no upfront cost. For bonus points, consider low maintenance, drought tolerant landscaping.

3.  Negotiate contracts

Most Boards oversee contract workers. Try to meet with each of them at least once or twice per year to evaluate their work and your rates. Again, don’t be afraid to shop around for better prices.

4. Separate needs from wants

We’ve seen communities cut reserve funds in order to refurbish the club house. This is a great example of short sighted, irresponsible decision making that happens all too often (sorry to be blunt). This will inevitably lead to special assessments and lower property values (try selling a condo in an under funded Association).


Read More: Cut Your Costs in 2013!

6 ways to improve your HOA board meetings

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1. Select a mutually convenient location. Your community club house is ideal but a nearby restaurant, school or church might work also. Keep in mind, you’ll need table space and a semi-quite environment. Keep it close to home for a better turn out.

2. Always be prepared. Never wing it. Help others do the same by creating and dispersing the agenda well before the meeting. Keep in mind – meetings are for making decisions. Everything else should be kept to a minimum.

3. Bring your association documents – especially the Covenants, Conditions, and Restrictions (CC&Rs). Any other supporting documentation such as Bylaws or additional Rules and Regulations may prove useful as well. It’s best to keep all these documents together and never leave home without them. You can never be too prepared.

4. All for questions. When allowing association members to attend meetings, be sure to set clear expectations that all comments / questions will be held until the end of the meeting. You want to be inclusive but don’t lose control of your board meeting. Remember – the goal is to make decisions, not argue.

5. End each meeting with a wrap-up – it should include action items and meeting minutes so everyone is prepared for the next meeting. Always share both items with the entire association within 2-3 weeks of the meeting.

6. Never allow alcohol, small children, or pets at the meeting. We love parties, kids and pets as much as the next guy but they have no place in a board meeting. Again, making decisions efficiently and effectively is the name of the game.


Read More: How to Hold a Successful Annual HOA Meeting

6 Steps for Removing a Board Member

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Unfortunately, there are many reasons for which HOA board members are ousted from power. Felony convictions, acts of fraud, or simply not performing the duties required of a board member – all are more common than you might think. The silver lining here is that it is possible for an HOA to remove the board member for their mistakes; hopefully before too much damage is done.

Here’s how:

1. See governing documents

The governing documents of your Homeowners Association should clearly state the necessary procedure for recalling board members. Look especially close to the following information: how can votes be submitted? What percentage of votes are needed for removal? How can the new board position(s) be filled?

2. Consult an attorney / See local and state laws

Depending on the situation and state, there may be additional laws your HOA is required to follow. Failure to do the proper due diligence could exacerbate the situation – not to mention cost you a lot of money down the road.

3. Initiate a petition, collect signatures

Draft a proposal to recall the board member(s) and secure the required signatures from homeowners. Depending on your HOA’s governing documents, you may need to include the reason(s) for the removal.

4. Plan to replace the member(s)

Assuming your petition is successful, you’ll need to fill the board seats rather quickly after the offending member(s) are removed. Luckily, the governing documents should determine how to go about this. Either way, it’s important to plan ahead before heading into the war room.

5. Hold a meeting to for the final vote

It’s extremely important to do this in accordance with your governing documents and state laws. Both may dictate how to go about this and also how much advance notice is required for homeowners.

6. Vote!

If the vote is successful in recalling board members, it’s advisable to elect new members immediately to fill those vacant seats. Otherwise, the removed members may be able to continue to serve on the board until the new members are elected.

Removing a board member is certainly possible and in many cases completely necessary. But it’s definitely not easy and in some cases can be personal. It should only be done after careful consideration and for the greater good of the association.


Read More: Role of an HOA Board

Water Efficient Landscape Maintenance – The Easy Way

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Here in California we’re experiencing one of the worst droughts in decades. State wide, officials are calling for more stringent limitations on water usage. Water conservation is becoming necessary and even mandatory.Whether your HOA needs to save water to comply with state mandates, wants to save money or simply wants to be eco friendly – summer lawn and yard maintenance is a great place to start.We’ve put together a list of commonly overlooked tips that your HOA can put into practice today with little or no money.

1. Water aggressively

I know what you’re thinking and the answer is yes – you heard that right. By watering your lawn more heavily but less often, you can actually conserve the total amount of water used. By watering more aggressively, the water will last much longer — meaning you can go for longer periods of time without needing to water.

2. Easy on the cleanup

When the lawn is mowed, try leaving some clippings (not too many as it will look sloppy and unmaintained). The clippings act as a natural fertilizer which helps keep the lawn healthy with less water.

3. Try Organic fertilizers

Extra grass clippings not doing the job? Organic fertilizers could be a good bet but be warned that they take a bit longer to show results. With that said, the results they offer will ultimately last much longer, and keep your lawn healthier. This is a good investment but definitely not a quick fix.

4. Don’t get carried away

Cutting your lawn too short can actually lead to root damage and ultimately a dying lawn. When most people see a dying lawn there first reaction is to give it more water. This can be avoided with one simple rule of thumb: only mow the grass by approximately one third of its current length.

These are just a few easy and cost effective methods. But don’t forget there’s plenty of other ways for your HOA to save water when it comes to landscape maintenance. If you are up for spending the time and money – be sure to look into things like drought resistant landscape, drip irrigation and smart controllers.


Read More: Water Conservation – Save the Planet, Save Money!

CC&Rs – What Are They and Why Should I Care?

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In the past, while discussing Homeowners Associations and Reserve Studies, we’ve often mentioned CC&Rs or “Covenants, Conditions and Restrictions”. But what are they exactly?


This week we thought it would be a good idea to demystify this intimidating acronym. The good news is that it’s not quite as complicated as you might think.

Let’s take a look at what you need to know.

Covenants, Conditions and Restrictions (CC&Rs) are rules and limitations that govern on a group of homes (aka a community). Typically they are established by the developer, neighborhood association and / or homeowner association (aka HOA) to protect, preserve and/or enhance property values within the community. CC&Rs govern all town homes and condos; and most planned unit developments. They might, for example, prohibit owners from parking their cars on the street, watering the yard on certain days or even painting their house certain colors.

While much of the CC&Rs dictate aesthetics and promote conformity, you can also find important information regarding the homeowner’s financial obligations. For example, HOAs typically require to pay monthly dues and assessments. The types of dues, assessments, and penalties for non-payment (such as interest and late charges) can be found in.. you guessed it, the CC&Rs. If an owner falls behind on dues and/or assessments, the HOA may have the authority to file a lien on the home, which could lead to foreclosure.

To recap – The seemingly daunting CC&Rs simply boil down to the rules of your community. It’s easy to see why all homeowners and HOA board members should know this document inside and out. So make sure to take the time to familiarize yourself early and check back often.

Read More: 6 Ways to Prevent Board Member Fatigue

4 Mistakes Most New HOA Board Members Make (And how to avoid them)

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Everyone makes mistakes, especially when trying something new. New HOA Board Members are no different. The trick is to avoid common mistakes and learn from the unavoidable ones. Barrera and Company has been working closely with HOA Boards to prepare Reserve Studies for the past 30 years. We thought it might be helpful to put together a list of common mistakes that new Board Members make – and more importantly, how you can avoid them.Board Meeting

1) Thinking you can “wing it”

Too often, new board members take their seat at the table before learning what that actually entails. This is dangerous! If possible try to take a class or at the very least get your managing agent to give you an overview the roles and responsibilities within the HOA. Take the time to understand the management plan before you jump in. This will help you hit the ground running as an effective and efficient Board Member.

2) Simply doing too much

If you take the advice from point one, you know that your authority as a board member is derived from the HOA governing documents. And you have, of course, taken the time to understand them.

To put this simply: If it’s not in the governing documents, you can’t do it.

It’s easy to be enthusiastic and optimistic but never loose sight of reality. Some things, you simply can not change or regulate.

3) And doing it too soon

Along the lines of point two, another common mistake being to overzealous. Many times, people join the board for a specific reason. The minute they have the power, they try to enact change without fully understanding the implications of their actions. Any good decision takes time and the impact should be understood from all angles before action is taken.

4) Changing vendors hastily (Power trip alert!)

Try to avoid passing judgement on vendors before you’ve had the opportunity to meet with them. Maybe you didn’t like what they were doing before you came along but keep in mind that they take direction from the board. You might be able to turn the situation around without changing vendors. Again, you need to understand all sides.

By now you’re probably getting the idea. Most mistakes can be avoided with a little due diligence, patience and understanding. If you simply take the time to understand the Association, your role within it and the implications of your actions – you will be on your way to contributing to a healthy HOA.

Learn More: 6 Ways to Improve HOA Board Meetings

Water Conservation – Save the Planet, Save Money

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Water ConservationMany states, including our home state of California, are experiencing record low rainfall this season – an event that is sure to trigger tighter water restrictions for your Homeowners Association.

But the time of year or current conditions should not dictate your decision to pursue water efficiency. The bottom line is that saving water saves your HOA money – and all communities could do with a little extra room in this year’s budget.

With that in mind, we’ve put together 4 tips to help you save water and save green.

1. If you fail to plan, you plan to fail.

First things first – develop a water plan that’s made for your community. If mandatory water restrictions are in place, some communities often need to participate in a designated water budget program or water only on assigned days. Water budgets typically determine a specific number of gallons per square foot, inches per year or a percentage reduction of water use. While participating in such programs, communities can typically chose to water how and when they want as long as they are meeting the terms of the water budget. An irrigation professional can help you determine the best plan for your community.

2. Not being proactive can cost you.

Proper maintenance of irrigation systems are often overlooked and categorized as an unnecessary cost. The truth is proper maintenance is one of the best ways for your HOA to save water and money.

Multiple times per year, the system should be checked for broken heads and leaks. Make sure the heads are pointing in the right direction and that the spray is not blocked by other plants or tall grass. If the water pressure is too high heads may mist or fog, resulting in water that never hits its intended target. Installing devices that regulate the pressure will help you more efficiently and effectively water your property. Look into installing high efficiency nozzles – some of which are even rebated by your local water agency. Lastly, consider replacing heads with drip irrigation whenever possible.

3. Be smart about it.

Smart controllers take into account soil type, rain fall and plant requirements to deliver only the amount of water needed. The cost and features of such controllers vary but some can be completely controlled remotely via the Internet.

Some HOAs may deem smart controllers out of their budget but all should strongly consider installing rain sensors. This affordable yet effective device simply prevents the irrigation system from watering during the rain.

Again, some water utilities provide rebates that make upgrading a no brainer.

4. Don’t make a rookie mistake.

Not all landscape professionals are created equal. In fact, many are not irrigation experts at all. It’s important to make sure that your contractors keep in mind and are equipped to help you optimize your property for water efficiency. Work with them to determine the best water schedule, appropriate plant choices and available rebates.

Read More: Water Efficient Landscape… The Easy Way!

Interested in getting a Reserve Study for your community? Click here to get a proposal!

Top 10 Home Renovation Projects

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Many homeowners are looking for ways to improve the value of their properties. In this article, you’ll learn about the top 10 home improvement or renovation projects that offer a solid return on investment, listed from least to most costly. So, whether you’re just wanting to “spruce the place up a bit” or are looking for a way to get the most out of your old home to help pay for your new one, there’s something here for nearly every budget and dream.Garage Door

1. New front door – Replacing your old, tired front door with something more stylish is a rather inexpensive way to add some new value to your home, as well as to your curb appeal. Experts say that an upgrade to a steel door is a great investment, but warn against choosing a door strictly for its energy rating. Turns out homes lose more heat through gaps around the door than through the door itself.

2. New garage door – To echo the first item on this list, garage doors need some love too.

3. New siding – Give your entire home a facelift with a new cladding of vinyl siding. While this project is more expensive and complex than the first two, it is still relatively quick and budget-friendly while adding value and improving the look of your home.

4. New deck – A deck is a lovely and functional transition from inside to the outdoors. A new deck can be built over an existing but outdated patio or can replace an old, sagging wooden porch on the back of your home. The return on your investment is either years of enjoyable leisure, or about 75% of the costs, depending on whether you stay or go.

5. Minor kitchen updates – You don’t have to go all out. Consider replacing just the countertops, adding a backsplash, purchasing a sleek new appliance, or swapping the faucet for an elegant, water-saving model. Something as simple as new light fixtures or cabinetry hardware can add value, style, and atmosphere to an otherwise less-inspiring cooking cave. The budget and extent of the makeover is up to you.

6. Window replacement – Give your home an aesthetic and energy-efficiency makeover with new windows. While the budget for this project is larger, it’s well worth it and can pay for itself in climate efficiency over time.
7. Attic remodel – If you’re considering a real undertaking, turn that old, dusty attic into the master suite, library, or nursery of your dreams.

8. Basement remodel – Similar to the attic project, only in the basement, you’ll want to focus on family space. Adding family or “public” space in the basement can take you from cramped and cranky to peaceful and harmonious.

9. Major kitchen overhaul – And sometimes you do have to go all out. Kitchen remodels are pricey and require you do McGuyver kitchen space somewhere else in your home, but remodeling the heart of the home comes with many benefits, including a more beautiful and functional space and a solid ROI to go with it.

10. Second floor additions – You can nearly double the value of your home by doubling its size and functionality. Adding an entire floor, or even just a master suite, over your existing home can bring in a 65% or more increase in the sales price of your home. It also saves valuable landscaping and outdoor living space—a plus for smaller lots and cramped neighborhoods.

If 2014 is the year of the fresh home design for you, you’ll be off to a great start with any of the items on this list. Whether you gather your supplies for a DIY weekend or call your favorite local contractor, you’re in for a treat. Good luck!

 Read More: DIY Home Renovation Blunders to Avoid

Interested in getting a Reserve Study for your community? Click here to get a proposal!

How Effective HOAs Make New Year’s Resolutions

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Fresh StartWell, it’s that time of the year again – time to reflect on 2013 and resolve to make improvements for 2014.

But, just as you’ve set personal goals for the new year, now is the time to look ahead as a HOA (homeowners association) to form New Year’s resolutions that will set your community up for success this year.

Setting Community Goals (AKA Resolutions)

Effective HOAs constantly seek feedback and input from their homeowners. The beginning of the year is a great time to get on the same page. This year, before you get together with your board, reach out to your homeowners to determine the needs and goals specific to your community – you might be surprised at what you find. This often gives the board a fresh perspective while making owners feel included and active.

Now, take this feedback to your next board meeting for review and choose the areas most in need of improvement, define your goals and prioritize them based on need, budget, time and resources.

Next, you’ll want to distinguish between long, and short term goals. Breakup the long term goals into smaller milestones and recruit homeowners to help you reach them. If you were initially successful when seeking community feedback, this task becomes exponentially easier.

Last but not least, publicly share your community goals and your progress throughout the year. Use your community website and /or newsletter to keep everyone in the loop and up to date. The new year is a great time to reconnect but try to keep up the momentum. A good HOA’s job is never done.

We hope these tips will get your community off to a great start in 2014.

Here’s to a happy and healthy year!

Read More: 5 Homeowner Resolutions for 2014

Interested in getting a Reserve Study for your community? Click here to get a proposal!





3 of the Biggest DIY Blunders to Avoid

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DIY Home

Do You Need Permits?

Every homeowner wants to feel the pride that comes with completing do-it-yourself projects. But oftentimes when we’re on a mission, we unwittingly bite off more than we can chew. There are many DIY projects that can be tackled easily and successfully by most any homeowner without causing more harm than good, but here we’ll take a peek at a few common blunders that may require you to think twice before picking up that tool box and getting started.
Many homeowners jump right into a project before consulting city codes or condominium association rules. Oftentimes DIYers err on the side of just trying to finish a project quickly without anyone being the wiser, as permits are time-consuming. But permits are there to ensure that the time and money you invest into a project is put to good use. For example, San Diego electrical and plumbing permits are an integral part of planning any changes that might affect the integrity of these portions of the home. Oftentimes you need proof of a permit for an insurance carrier to cover it, or there may be specific height and material limits that you’ll need to adhere to in order to get the best price for your home should you choose to sell.

Buying Cheap Materials

It can be an intriguing idea to consider buying materials that are a few levels lower on quality than you originally budgeted. But trust that buying cheaper materials outright can actually cost you more in the long run. Cheap tile can break, cheap carpet can tear, cheap paint can peel, and cheap appliances can wear down or malfunction quickly. This doesn’t mean you have to buy the Cadillac of dishwashers in order to keep yourself out of the quality red zone; it simply means that sometimes a few extra dollars here can save you having to buy those materials all over again in short order. Think of it this way: you aren’t paying for labor, so you have a little extra room to get better materials.

Inaccurate Measuring

We’ve all heard the old adage, “measure twice; cut once.” It’s important not just for good measure, but because one wrong cut can cause a domino effect across an entire project. Fences, drywall, flooring, and other items in the home must be meticulously measured out, as beginning on the wrong foot can cause you to waste materials and run into issues once you hit the end of the project. Always err on the side of caution and measure everything diligently multiple times. A few minutes on the front end can save you from having to scrap yards and yards of material on the back end.
Taking heed of the potential to make these mistakes is the first step in preventing issues that can be caused by do-it-yourself projects. A little bit of planning can go a long way towards making sure your home project goes off without a hitch.

Read More: Top 10 Home Renovation Projects

Interested in getting a Reserve Study for your community? Click here to get a proposal!