The Biggest Mistakes HOA Boards Make & How to Fix Them | 175

HOA Insights: Common HOA Board Mistakes—and How to Fix Them

This episode of HOA Insights focuses on common, recurring mistakes HOA (community association) boards make and how those failures can be addressed—drawing heavily on the guest’s experience in association/D&O (directors & officers) insurance.

Core problems HOA boards face

1. Underfunding reserves (improper reserve setting)

   • A major recurring failure is boards delaying or minimizing reserve contributions to maintain a more popular “easy” board reputation.
   • Over time, deferred maintenance accumulates (e.g., roofs, siding, plumbing replacements). When major events occur—such as storms, widespread leaks, or simultaneous equipment failures—the association lacks the cash to respond.
   • This financial shortfall can lead to serious consequences, including lawsuits against the board for negligence tied to improper reserve funding.

2. Human friction and “I bought a house, so I should be able to do what I want”

   • The guest describes association living as uniquely personal and conflict-prone because residents view their unit/home as their “castle.”
   • Common disputes include:
     • Architectural/esthetic restrictions (e.g., allowable paint colors)
     • Fairness/discrimination claims when residents believe rules are applied inconsistently (the example given includes color-blindness and alleged discrimination logic)
     • Pet restrictions, noise issues, and other “livability” rules
     • ADA/access-related needs (e.g., ramps or pool access devices being unavailable)
   • The takeaway: many conflicts arise when owners don’t internalize that they agreed to association rules and governance.

A real-world illustration

• The host shares that even professionals can run into HOA rule enforcement. He describes having a garage door color changed according to an interior designer’s plan, only to receive an HOA note restricting the change.
• The issue was resolved after engaging the management/committee, reinforcing that no one is immune to HOA friction and approval processes.

Proposed “fixes” and behavior changes (what boards can do now)

The guest’s recommendations center on practical governance practices rather than needing major legislative overhaul:

1. Transparency and disclosure

   • Boards should keep proper notes and disclose relevant conflicts—for example, if a contractor relationship involves a board member’s relative.

2. Strong recordkeeping and institutional knowledge

   • Good documentation prevents re-hiring the same vendors or repeating the same mistakes because future boards lack context.
   • This also supports effective reserve planning and continuity across board turnover.

3. Build trust / “political capital”

   • Proactive responsiveness (e.g., making budgets accessible without dismissive barriers) helps reduce conflict and improves cooperation.

4. Social momentum: educate residents about what association living requires

   • The host frames it as people increasingly understanding that HOA life requires compromises and collaboration—not everyone is a good fit, but education helps reduce misunderstandings and conflict.

5. Sufficient reserves

   • Ultimately, reserve adequacy is the cornerstone: deterioration and aging infrastructure should be planned for so boards don’t create crises they can’t fund later.

Future emphasis

• The guest argues that board effectiveness should improve through training and education, since many board members are volunteers from unrelated professions and may not understand how to run an association like a “company that you live at.”
• Examples of existing pathways mentioned include association education resources and board-oriented training opportunities.

Presenters / contributors

• Robert Nordland (host, HOA Insights)
• Eric Davis (Kevin Davis Insurance Services; first-time special guest)