Compare HOA Management Options

There are four main HOA management options: manage the association yourselves, hire a company for the financial work only, hire a full-service company whose manager also looks after other communities, or pay for a manager based at your property. They differ in how much work stays with the board, how much attention you get and what you pay. Under every model the board makes the decisions and stays responsible for the association.

If your board hasn’t settled whether to hire anyone at all, start with Self-Managed vs. Professional HOA Management. This page compares the service models, then explains how to choose an HOA management company if you decide to hire one.

The four HOA management options

Model	What it typically includes	What stays with the board	Tends to suit
Self-managed	No management company. The board hires vendors and professionals directly	All of the work: bookkeeping, records, vendor oversight, owner contact and deadlines	Small communities with simple common areas and steady volunteers
Financial or accounting-only	Billing and collecting assessments, paying approved invoices, bookkeeping, monthly financial reports and records for the CPA	Maintenance, vendors, meetings, rule enforcement and owner communication	Boards that run the property well but want the money handled by a third party
Full-service portfolio management	A community manager who handles several associations, backed by accounting and administrative staff: finances, meeting support, scheduled inspections, vendor coordination and owner contact	Decisions, approvals and oversight of the manager	Communities with more work than volunteers can carry, but not a full-time workload
On-site management	A manager, sometimes with other staff, working at the community full time or part time	Decisions, approvals and oversight, plus a larger budget to approve	Large communities and those with extensive amenities or building systems

These labels are not standardized. One company’s full service can leave out work that another includes, so compare the written scope, not the name. What Do HOA Management Companies Actually Do? describes the typical services. Also check that you are dealing with an association management company and not a rental property manager, which does different work.

How to compare proposals fairly

Give every company the same written scope of work. Then check each proposal on the same nine points.

Scope of services. Ask for specifics: how many site inspections a month, how many board meetings attended, who answers owners, and when the monthly financial report arrives.
Base fee versus extras. Ask for the complete fee schedule. Extra meetings, mailings, violation letters, project oversight and setup are often billed separately. Ask what the company charges owners and buyers directly, such as fees for resale documents.
Staffing and manager workload. Find out who would be assigned to you, how many other associations that person handles, and who covers when they are away.
Technology and owner portal. See how owners pay, view their accounts and submit requests, and what directors can see. Ask who owns the data.
Financial controls and bank accounts. Ask whose name the accounts are in, who can release a payment, who reconciles, and whether directors can view the accounts online.
Insurance and fidelity coverage. Ask for certificates showing the company’s general liability, professional liability, workers’ compensation and crime or fidelity coverage for theft of client funds.
References from similar communities. Call associations of about your size and type. If you can, include one that has left the company.
Transition plan. Ask how the company would take over your records, bank accounts and owner ledgers, how long it would take and what it would cost.
Contract term and termination clause. Check the length of the term, whether it renews automatically, how much notice ends it without cause, and what happens to your records and money afterward. What Are HOA Management Contracts? explains each term.

We don’t quote typical fees, because pricing varies by region and community. To compare cost, estimate each proposal’s total for a normal year: the base fee plus the extras you would use. Our vendor comparison worksheet gives you a side-by-side layout, and Can Hiring an HOA Management Company Save Your Community Money? explains what drives the price.

Questions to ask a prospective management company

Who would be our manager, how many other associations does that person handle, and who takes over if they leave?
What is included in the base fee, and may we see the schedule of every other charge?
Do you, your owners or your affiliates have a financial interest in any vendor you recommend, or receive payments from one?
Where will our money be held, in whose name, and who can move it?
May we see a sample monthly financial report?
How quickly do you answer owners, and how do you handle after-hours emergencies?
What credentials do your managers hold, and who issued them?
If we end the contract, how and when do we get our records, data and funds back?

Red flags

A scope described only as customary or standard management services.
Reluctance to put the full fee schedule in writing.
Association money pooled with other clients’ funds, or kept where the board cannot see it.
Undisclosed ties to vendors, or pressure to use affiliated vendors.
A long term that renews automatically, with no exit without cause or a large termination fee.
Contract language that treats your records as the company’s property.
Promises of guaranteed savings or higher property values, or a claim that the board will have nothing left to do.
Discouraging you from having the association’s attorney review the agreement.

How to choose an HOA management company, step by step

Write the scope: the services you want, how often, and the reports you expect.
Send the same request to several companies that manage communities like yours.
Compare the written proposals side by side on the nine points above.
Interview the finalists, and meet the person who would be your manager, not only the salesperson.
Call the references and check the insurance certificates and credentials yourself.
Have the association’s attorney review the agreement before the board signs.
Vote at a board meeting, record the decision in the minutes, and tell owners where to send payments and questions.
Review the company against the contract once a year.

In California

These are legal requirements in California, not just good practice:

Written disclosures before you sign. Under Civil Code section 5375, a prospective managing agent must give the board a written statement as soon as practicable, and no more than 90 days, before entering into a management agreement. It covers the firm’s owners, their relevant licenses and professional certifications, and any business in which the manager or firm has an ownership interest, profit-sharing arrangement or other monetary incentive.
Conflicts disclosed with the bid. Section 5375.5 requires a manager or management firm to disclose any potential conflict of interest in writing when it presents a bid for service to the board.
Handling of association funds. Civil Code section 5380 requires a managing agent to deposit association funds in a trust fund account at a California bank, savings association or credit union, unless they go into escrow or an account the association controls. It must keep separate records and may not commingle the funds with its own or anyone else’s money.
Fidelity coverage. If the association uses a managing agent or management company, Civil Code section 5806 requires the association’s own crime or fidelity coverage to include dishonest acts by that company and its employees.
Manager credentials. Business and Professions Code sections 11500 to 11506 control who may use the title certified common interest development manager. The certification comes from professional associations, not a state agency. Section 11504 requires a manager to tell the board each year whether they are certified and by whom, and to disclose before a contract is signed or renewed whether their fidelity insurance covers the association’s operating and reserve funds.
The board keeps ultimate direction. For incorporated associations, Corporations Code section 7210 lets the board delegate management to a management company, provided all corporate powers are exercised under the board’s ultimate direction.

Keep these disclosures with the proposals. More on working with a manager is in our HOA management section.

The Law Behind This Page

Every legal point in this page comes from the official text. Each link below opens it in a new tab.

Civil Code sections: 5375 · 5375.5 · 5380 · 5806

Corporations Code sections: 7210

Business and Professions Code sections: 11500 · 11504

This page is general educational information, not legal or financial advice. Laws vary by state and your association’s governing documents control many of these questions, so check with your association’s attorney or another qualified professional about your situation.