Frightening 2023 Megatrends Shift HOA Business Reality

Fifty years ago, the Executive Council of Home Owners was founded to organize the industry and help establish a set of laws that govern its growth and bring together homeowners, boards, and industry professionals. Its mission was to foster a better quality of life in communities managed by homeowners associations. It successfully advocated for a legal framework in Sacramento allowing communities to empower homeowners to self-manage the common areas of their communities and to ensure a safe and enjoyable place to live, respectful of individual homeowner interests and shared community values.

2023 HOA Megatrends

• Systemic Inflation

• Chronic Labor Shortages

• Community Mental Health Awareness community conduct.

The phrase engenders humanity. The words roll from one’s stark business senses and adds the element of humanity to a board: Strategic planning, execution and evaluation; mission management. The business realities should be reflective of common values of individuals in the community. Communities are imperfect – because they are made of humans. relating. Humans using. Human living. Basically, humans being being human, communities sometimes forget that management establish norms for a successful community. In a sense, the the community. Its purpose is to establish order and elevate progress and pace by establishing norms and constraints to benefit all.

California has more than 54,000 HOAs with approximately 14.7 million unique residents living in them. It is extremely challenging for boards to manage these HOAs, especially given the rapidly changing business and legal environment in which they serve. The constant barrage of new laws and judicial decisions makes the practical role of being a board director ever more challenging and complex.

It seems apparent that board leadership must understand owners in order to orchestrate a sense of community and generate and protect community values. The purpose of a board, therefore, build community based on common values for the good of

Today, the vision and values established in the mission of Echo still ring true. For the most part, these values have been incorporated into a legal framework called the Davis-Stirling Act. This act allows homeowners to manage their common interests. And even though there have been many assaults and judicial decisions that have challenged and remodeled the framework, this body of laws has survived as the preeminent framework within which HOA communities exist. In its evolution over the years, the Davis-Stirling Act has protected individual rights and liberties while giving legal weight to the importance of building norms and standards for

It takes time to orchestrate a community. It takes time to know time to listen to the voices and build a vision reflective of community and you will be more effective as a board member and satisfied your reason for being on the board.

ECHO is committed to helping homeowner boards and residents ing and advocacy – this is our “raison d’etre”.

This year marks a new, materially different post-pandemic era with an emerging new reality; 2023 was ushered in with frightening megatrends that are expected to materially disrupt the ability of volunteer boards to successfully manage the business of their communities. And while the Davis-Stirling Act provides some protection for the HOA entity, it is threatened by its own weight of amendments and propensity for rapid change, which is hurting the very communities it was established to protect and preserve. In 2023, the HOA industry is undergoing a fundamental shift. It is time to identify, understand, and manage the change – it’s not going away.

The threads in the articles are indicative

Continued on page 34

ECHO CHIEF EXECUTIVE OFFICER

David Zepponi Executive Director

BY ROLF CROCKER, AMS, CCAM, CAMEx