Why Association Assessments Are Rising and What Homeowners Should Know

Across the country, homeowners are seeing the cost of community association living increase. A recent report from The Wall Street Journal, citing an analysis by Realtor.com, found that median monthly condominium fees increased 29% between 2019 and 2025, while fees for single-family homeowners associations increased 26%.

Those figures may feel alarming, but they reflect a broader reality: community associations are facing many of the same rising expenses affecting individual households and businesses. Insurance premiums, utilities, professional services, labor, construction materials, and routine maintenance all cost more than they did several years ago.

Understanding what assessments pay for—and why they sometimes need to increase—can help homeowners better evaluate their association’s financial decisions.

What Do Association Assessments Pay For?

Homeowners association and condominium assessments fund the operation, maintenance, and long-term care of the community. Depending on the association, assessments may pay for:

• Landscaping and grounds maintenance

• Common-area utilities

• Insurance

• Trash or recycling services

• Pool and amenity operations

• Road, sidewalk, or parking-area maintenance

• Building repairs and exterior maintenance

• Management and professional services

• Legal and accounting expenses

• Contributions to reserve funds

In a condominium, assessments may cover expenses that a single-family homeowner would otherwise pay individually, such as exterior building maintenance, roof replacement, structural repairs, or portions of the property’s insurance.

For that reason, comparing association assessments without comparing the services and responsibilities they cover rarely provides the complete picture.

Why Are Assessments Increasing?

Association budgets are based on the actual cost of operating and maintaining the community. When those underlying expenses rise, the association must adjust its budget accordingly.

Insurance has become one of the most significant challenges for many associations. Premiums, deductibles, and coverage requirements have increased considerably in some markets, particularly for communities with older buildings, extensive common property, prior claims, or exposure to weather-related risks.

Associations are also paying more for landscaping, repairs, utilities, professional services, and construction materials. At the same time, aging community infrastructure may require more frequent maintenance or replacement.

Unlike a traditional business, a community association is generally not generating profits to absorb these increases. Its operating funds come primarily from homeowner assessments. When expenses increase, the association must either raise assessments, reduce services, postpone work, or use funds intended for another purpose.

Each of those choices has consequences.

The Importance of Reserve Funding

Reserve funds are set aside for the future repair and replacement of major community components. Depending on the association, this may include roofs, siding, roads, elevators, pools, clubhouses, drainage systems, or other shared assets.

Adequate reserve funding allows an association to spread the cost of predictable projects across the owners who benefit from those components over time. It also reduces the likelihood that homeowners will face a large special assessment when a major repair becomes necessary.

Keeping assessments artificially low may feel beneficial in the short term, but it can create much larger financial challenges later. Deferred maintenance often becomes more expensive, while underfunded reserves may leave future owners responsible for costs that should have been collected gradually.

A well-prepared reserve study gives the board a roadmap for anticipated projects, estimated costs, and recommended annual contributions. However, the study is only effective when it is reviewed regularly and meaningfully incorporated into the association’s budget.

What Responsible Budgeting Looks Like

A responsible association budget should reflect the community’s actual needs rather than focus exclusively on keeping assessments as low as possible.

Boards should evaluate:

• Current contracts and expected increases

• Insurance premiums and deductibles

• Utility costs

• Maintenance needs

• Delinquency and collection trends

• Reserve-study recommendations

• Upcoming capital projects

• The condition and age of major community components

• Reasonable contingencies for unexpected expenses

This does not mean every proposed expense should automatically be approved. Boards should review contracts, seek competitive proposals when appropriate, evaluate service levels, and identify opportunities to control costs.

However, responsible cost management is different from simply postponing necessary work or underfunding the budget.

Communication Matters

Assessment increases are rarely welcome, particularly when homeowners are already managing higher household expenses. Clear communication can make the reasoning behind those increases easier to understand.

Boards should explain:

• Which expenses have increased

• Whether services or maintenance responsibilities have changed

• How much is being contributed to reserves

• What major projects are anticipated

• What cost-saving measures were considered

• What could happen if funding is reduced or postponed

Homeowners may not agree with every decision, but they should be able to understand how the board reached it.

What Homeowners Can Do

Homeowners can become better informed by reviewing the association’s annual budget, financial statements, reserve study, and meeting materials. They can also attend open board meetings and ask constructive questions about community priorities and long-term planning.

When purchasing within an association, buyers should look beyond the current assessment amount. An unusually low assessment is not always a sign of strong financial management. Buyers should also consider the association’s reserves, upcoming projects, maintenance history, insurance position, and history of special assessments.

The goal is not simply to find the community with the lowest monthly assessment. It is to understand whether the association is collecting enough to maintain the property and meet its obligations.

Planning for the Community’s Future

No board wants to increase assessments, and no homeowner wants to pay more. Yet maintaining a safe, attractive, and financially stable community requires realistic planning.

Thoughtful budgeting, adequate reserve funding, transparent communication, and proactive maintenance can help communities manage rising costs while reducing the risk of financial surprises. Assessments should support both the needs of today’s homeowners and the long-term health of the community they share.

At myStreet Community Management, we work with association boards to evaluate operating needs, understand financial obligations, plan for future projects, and communicate those decisions clearly to homeowners.

Source and further reading: Nicole Friedman, “Surging HOA Fees Are Pushing Homeowners to the Brink,” The Wall Street Journal, April 9, 2026.