You Won't Believe How Much HOAs Have Grown (2021)

By Ryan Kwon, Communications Manager, CACM

According to the Levy, Erlanger & Company’s latest tracked data, approximately 600 new HOAs were added to the state of California (100 fewer compared to 2020), representing an approximate 1.1% increase.

Compared to 2020’s HOAs’ gross revenue of $13.7 billion, 2021’s revenue has increased by a whole 3%, totaling an approximate $14.1 billion. “Although, percentage wise, there is a minimal change, HOAs and their units have been growing by the thousands,” said David Levy, founding partner of the Levy, Erlanger & Company.

California currently has around 55,000 (55,399 associations to be exact) HOAs residing inside of it, and according to Levy’s statistics, around 66% (36,409 associations) of those associations are located in Southern California while the remaining 34% (18,990 associations) can be found in Northern California.

Amongst those HOAs, approximately 60% of them are managed by management companies, 37% of them are self-managed, and 3% of them are on-site managed. According to the Levy’s statistics, most of the self-managed and on-site managed associations are typically smaller than company managed ones (majority being no bigger than 25 units in size).

When dealing with preference, “management companies prefer to work with larger associations rather than smaller ones, because there’s more profit to be made,” Levy said. “It’s better to work with a board with 5 members with 20 associations than a board with 20 members with 5 associations. It’s simple economics.”

In terms of development types, condos and condo conversions are sweeping the majority with 65% (33,258 associations) while planned unit developments remains in the minority with 34% (17,752 associations). The other 1% (4,389 associations) is inhabited by cooperatives and timeshare and unclassified developments.

Although no particular trends have caught Levy’s eyes, he’s “keeping tabs on the continued growth of larger management companies by merging/acquiring smaller companies as older owners head for retirement.”

Currently, the counties that are seeing significant growth in HOAs are Napa, San Bernardino, Placer, and Santa Clara. Other counties seeing moderate growth in HoAs are Alameda, Butte, Contra Costa, El Dorado, Fresno, Kern, Los Angeles, Mono, Monterey, Riverside, Sacramento, San Diego, San Francisco, San Joaquin, San Luis Obispo, San Mateo, Sonoma, Tulare, and Ventura.

Levy obtains his data for his statistics from various sources that include: California’s Department of Real Estate public reports and Secretary of State, over 1,500 Northern Californian managers, other state sources, and the internet. Annually, Levy compiles his statistics in September using a program that pulls all the necessary information for his statistics from his sources.

Levy, Erlanger & Company has been compiling its annual statistics book for more than 13 years but began tracking the number of HOAs in California for a much longer period of time. David Levy, founding partner of the firm, has been building the firm’s database since 1985.