Why are my HOA fees going up?
By OurHOA · General information · Revised
Insurance, underfunded reserves, vendor contracts, and unpaid balances drive most dues increases. How to read the budget and what limits may apply.
It's rarely just one thing
A dues increase is usually the board passing along costs the association already has, not a new spending spree. The budget pays for the master insurance policy, landscaping, management, utilities for common areas, and savings for big future repairs, and most of those lines have been climbing at once. Realtor.com's 2025 HOA report put the median monthly fee at $135, up from $125 the year before and $108 in 2019. Your community's number could be higher or lower, but the direction has been the same almost everywhere.
Insurance is often the biggest jump
In a 2023 survey by the Foundation for Community Association Research, more than 90 percent of respondents reported rising insurance premiums, second only to management fees. Say your 60-home community's master policy renews at $72,000 instead of $48,000. That extra $24,000 works out to $400 per home per year, or about $33 a month, before anything else in the budget moves. Communities in areas exposed to hurricanes, wildfire, or hail have often seen much steeper renewals, and some insurers now want current reserve studies and maintenance records before they will quote at all.
Reserves catching up with reality
Reserves are the savings account for roofs, paving, pool resurfacing, and other big items that wear out on a schedule. If earlier boards kept dues low by underfunding them, a new reserve study can show a gap that has to be closed. Suppose the buildings need $300,000 in roof work in eight years and the reserve fund holds $60,000. Closing that $240,000 gap across 60 homes means about $500 per home per year, and that is before inflation raises the roofing bid. Some states now require it: in Florida, condo associations with buildings three habitable stories or higher must get a structural integrity reserve study, and for budgets adopted on or after December 31, 2024, owners can no longer vote to waive or reduce reserves for the components it covers.
Contracts, labor, and neighbors who don't pay
Landscaping, maintenance, and management contracts reset when they come up for renewal, and in that same 2023 survey most respondents reported higher costs for maintenance and landscape services. Delinquencies matter too. When some owners stop paying, the association still owes its vendors, so the budget may raise dues or add a bad-debt line to cover the shortfall. And deferred maintenance tends to come back more expensive: a parking lot that should have been sealed three years ago may now need to be repaved.
Limits on how much dues can rise
That depends on your state and your governing documents. California is a well-known example: a board generally cannot raise regular assessments more than 20 percent over the prior year, or levy special assessments totaling more than 5 percent of budgeted expenses, without owner approval. The law carves out exceptions for court orders, health and safety hazards, and repairs the board could not reasonably have foreseen. Many other states leave caps entirely to the CC&Rs or bylaws, which may set their own percentage limit, require an owner vote, or say nothing at all.
How to get a straight answer
Ask for the proposed budget next to last year's actual spending and compare line by line so you can see which categories grew. Then ask for the most recent reserve study and the insurance renewal summary, since those two documents explain most large increases. Many associations adopt next year's budget in the fall, so the budget meeting is the best time to ask questions or suggest cuts. If the numbers still don't add up, state law or your governing documents usually give owners a right to inspect the association's financial records, and asking in writing tends to get a more careful response than a hallway conversation.
Sources
- Community Associations Institute: Condos and HOAs confront rising insurance premiums (Rising Costs survey)
- Realtor.com: Nearly 44% of U.S. homes for sale now carry HOA fees as dues continue to climb
- Florida Statutes section 718.112: condominium budgets, reserves, and structural integrity reserve studies
- California Civil Code section 5605: limits on assessment increases
- California Civil Code section 5610: emergency exceptions to assessment limits
These guides are general education for HOA boards and residents, not legal, tax, or financial advice. Rules vary by state and by your community's governing documents - check with a professional for your situation.