Own Luxury Homes®
HOA Management Companies: What They Do and the Conflicts Buyers Should Know
HOA management companies: hired by the board to handle day-to-day operations (dues collection, vendor management, maintenance coordination, meeting administration). Fee structure: flat fee ($200-$800+/month for the community) or percentage of HOA revenue (6-12%). Potential conflicts: some management companies receive referral fees or volume discounts from vendors they recommend to HOAs; these arrangements should be disclosed under state fiduciary rules. Evaluating a management company: CAMS (Community Association Manager) license status, complaint history with state regulators, and owner reviews. Own Luxury Homes® 12-Point Agent Integrity Audit™.
HOA Management Companies: What They Do and the Conflicts Buyers Should Know
The HOA management company runs the daily operations of your community but answers primarily to the board, not to you as an individual owner. Here is what they do, how conflicts of interest arise, and how to evaluate one.
A community association management company (CAM company) provides administrative services to the HOA under a contract with the board. Typical responsibilities:
• Dues collection and accounts payable: billing owners, collecting payments, paying vendors, maintaining financial records
• Vendor management: hiring and supervising landscaping, pool service, security, maintenance contractors
• Maintenance coordination: responding to owner requests, scheduling repairs, managing work orders
• Meeting administration: preparing meeting notices, recording minutes, preparing board materials
• Violation enforcement: sending notices, tracking cure periods, coordinating with association attorneys
• Insurance administration: maintaining association insurance and handling common area claims
The management company does not make policy decisions — the elected board does. The management company implements board decisions. When an owner has a problem with how rules are enforced or funds are managed, the ultimate accountability runs to the board, not the management company (though the management company can be replaced by the board).
Fee structures:
• Flat monthly management fee: typically $200-$800+/month for the community, depending on size and service level
• Percentage of HOA revenue: 6-12% of total dues collected; creates a structural incentive to increase dues
• Per-unit pricing: $10-$25/unit/month for large communities
• A la carte add-ons: many management companies charge separately for project management, legal coordination, after-hours calls, and reserve study coordination
The vendor conflict: management companies that source vendors (landscapers, pool service, general maintenance) for HOAs they manage may receive referral fees or volume pricing arrangements with those vendors. In most states, this must be disclosed to the board; in practice, disclosure is inconsistent.
The owner's interest: vendors hired through a management company that has a financial relationship with them may be selected for reasons other than best price or quality. Boards should solicit competitive bids for major contracts independent of management company recommendations, especially for projects over $5,000-$10,000.
Florida licensing: Florida requires Community Association Managers (CAMs) to be licensed by the DBPR. The CAM license requires education, exam, and continuing education — and licensees are subject to disciplinary action. Verify the management company's CAM license and complaint history at DBPR's online lookup.
As a buyer researching an HOA, the management company is a meaningful data point:
• Search for owner reviews of the management company on Google and community association review sites
• In Florida: check the DBPR license lookup for any disciplinary actions against the CAM license
• Check how long the current management company has been under contract: frequent management company changes signal board governance instability or financial disputes
• Ask at the board hearing or in writing: "When was the management contract last competitively bid?"
A community with a well-regarded, long-tenured management company and a stable board is a significantly different ownership experience than one cycling through management companies and dealing with delinquency collection issues.
Does an HOA have to have a management company?
No. Many smaller HOAs (under 50-100 units or homes) are self-managed by the elected board, typically using volunteers or part-time bookkeeping help. Self-managed HOAs can function well in stable communities with engaged boards and simple operations. They tend to struggle with consistent enforcement, vendor management, and financial administration as the community ages or grows. For communities over 100 units, or any community with significant shared infrastructure (elevators, pools, structured parking), professional management is generally advisable.
What does an HOA management company do?
A community association management company handles the day-to-day operations of an HOA under contract with the elected board: dues collection and financial record-keeping, vendor sourcing and supervision (landscaping, pool, maintenance), maintenance coordination and work orders, violation notice issuance and cure tracking, meeting notice and minutes preparation, and insurance administration. The management company implements board policy but does not set it. For individual owner concerns, the first point of contact is the management company; ultimate accountability for policy is the elected board.
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— Ryan Brown, Principal Broker & CEO, Own Luxury Homes® (FL License BK3626873)