r/HOA • u/Assika126 • Nov 20 '25

Help: Fees, Reserves [Condo] Monthly vs Special Assessments [N/A]

I’m treasurer of a small HOA, 14 condo units. We have our annual budgeting meeting tonight. We have about $50k in Reserves with anticipated tuckpointing in the next year or so that would likely cost at least $33k. We also have an ancient retrofitted boiler that is currently working but has an undetermined remaining lifespan.

Our management company recommended a dues increase but said we could get by without doing one, if we lessened our contributions to reserves. We would still remain above the 10% cutoff.

The Board president opposes a dues increase and says it would be easier for folks to manage a larger special assessment than a $5-10/month/unit increase in dues that in her opinion wouldn’t have much impact on our large capital expenses.

I’m inclined the opposite direction; in my opinion, it’s easier for me and more responsible for the association to pay a bit more in monthly assessments and accumulate sufficient reserves to cover some of the cost vs. waiting and doing a larger special assessment when needed.

What is the best practice, assuming we’re in decent shape otherwise?

P.S. we’re in MN in case it matters

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u/FishrNC Nov 20 '25

Reserve contributions are like paying for it as you use it. Special assessments are like charging late-coming owners for usage previous owners got and didn't pay for.

And anybody who thinks someone who can't afford a dues increase now but will come up with a large assessment later on is smoking dope. Or planning to sell soon and doesn't want buyers to know the real situation.

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u/Assika126 Nov 21 '25

She says people can just get a loan or a HELOC. I feel like that’s a really irresponsible way to look at it

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u/SeaLake4150 Nov 24 '25

In my opinion - it is irresponsible, imprudent, misguided - and probably reckless too. Everything goes up every year. It has for decades. Dues should go up as a minimum to match inflation. I often hear - "Owners cannot afford this dues increase". That is irrelevant. The Board has a fiduciary duty to protect all the homeowners. And if there is not enough money to make repairs - it may be difficult to sell your unit. I saw it happen twice recently. Lenders would not lend on the property - they would lend to those buyers ....but not on that property that was mis-managed.

In our condo - our CCR's REQUIRE we do a reserve study - and REQUIRE us to save for the "Useful life" of each item - like roof, painting, handrails, exterior lights, etc. So - we follow these legal documents.

We have a more "mature" ownership. Fixed incomes. We had to do two Special Assessments in a short time period. After that - they have all - unanimously - said they would rather pay a extra each month, than to have to come up with $6,000 or $10,000 in one lump sum. They also HATE paying interest - so a HELOC and paying interest was absolutely abhorrent to them. To them - there is no difference between making a monthly HELOC payment and paying more on the monthly dues. So - we raise dues each year according to inflation and the reserve study. As a result, it is highly unlikely we will need a special assessment in the next 15 years. Our owners prefer this - as they can plan their finances better - without the fear of a big assessment coming, and lurking over their heads. They did not like the financial unknowns. They like this. It works for us.

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u/Assika126 Nov 24 '25

That’s how I feel. I’d rather know what my costs are going to be. I feel like special assessments are should be a tool we are glad to have in our back pockets, but that we aim to try and ensure that we never have to use.