Rising HOA Dues Add to Homeowners' Affordability Challenges

Rhea-AI Summary

Realtor.com reports a significant rise in Homeowners Association (HOA) fees, adding to housing affordability challenges. The study reveals that 40.5% of for-sale listings in 2024 had HOA fees, up from 39.2% in 2023, with median fees increasing to $125/month from $110.

New construction homes show a higher likelihood of HOA fees at 69.9% compared to 37.1% for existing homes. Similarly, 83.8% of condos, rowhomes, and townhomes have HOA dues versus 33.6% of single-family homes.

The top three metros with highest HOA presence are Edwards, Colorado (89.9%, $525 median monthly fee), Myrtle Beach, South Carolina (84.8%, $138), and Heber, Utah (83.3%, $300). Conversely, areas with lowest HOA presence include Anniston, Alabama (3.8%, $29) and Elizabethtown, Kentucky (5.0%, $19), typically in smaller, inland markets with fewer new builds.

Positive

• None.

Negative

• HOA fees increased from $110 to $125 monthly median in 2024
• Higher percentage of homes (40.5% vs 39.2%) now require HOA fees
• New construction homes face significantly higher HOA exposure (69.9%)
• Some markets show extremely high monthly HOA costs (up to $525 in Edwards, CO)

Insights

Market Research Analyst

This comprehensive data on HOA trends reveals significant shifts in the real estate market structure. The 40.5% of listings with HOA fees in 2024, up from 39.2% in 2023, coupled with a $15 increase in median monthly fees to $125, represents a meaningful cost burden for homeowners.

The geographical distribution is particularly telling - resort and high-growth markets like Edwards, Colorado (89.9% HOA penetration) and Myrtle Beach (84.8%) show dramatically higher HOA presence compared to smaller inland markets like Anniston, Alabama (3.8%). This creates distinct market segments with varying cost structures.

The stark contrast between new construction (69.9% with HOAs) versus existing homes (37.1%) indicates a structural shift in housing development patterns that will have long-term implications for housing affordability and market dynamics.

Real Estate Finance Expert

The rising HOA fee trend compounds the current housing affordability crisis. With monthly dues increasing by 13.6% year-over-year, this adds meaningful pressure to total housing costs in an already challenging high-rate environment. The higher prevalence in condos (83.8%) versus single-family homes (33.6%) disproportionately affects first-time buyers and downsizers who often target these property types.

Markets with the highest HOA penetration, like Edwards with a $525 median monthly fee, demonstrate how these costs can significantly impact affordability calculations. When combined with mortgage payments, property taxes and insurance, HOA fees materially affect debt-to-income ratios and overall buying power, particularly in high-cost markets.

New Report from Realtor.com^® Finds Edwards, Colo., Myrtle Beach, S.C. and Heber, Utah are the Top Three Metros with the Highest Share of HOAs

SANTA CLARA, Calif., Jan 15, 2025 /PRNewswire/ -- As Americans grapple with housing affordability challenges, one more housing cost is on the rise, Homeowners Association (HOA) fees. According to a new report from Realtor.com^® released today, more homes on the market last year had an HOA fee and those fees were more costly than the year before. When looking at monthly HOA fees shown on listings on Realtor.com^®, 40.5% of for-sale listings in 2024 had a nonzero HOA fee, up from 39.2% last year with a median fee of $125/month, up from $110.

"With a down payment and closing costs up front, and then principal, interest, taxes, and insurance every month after that, purchasing a home is already a financially daunting task, before adding in the rising cost of HOA dues," said Danielle Hale, chief economist at Realtor.com.^®  "Homes like condos, townhouses and new construction single family homes in neighborhoods with ample amenities are more likely to have an HOA fee. For many of these properties, HOA benefits often include a certain amount of maintenance and even utilities that homeowners without an HOA will need to include in their budget. When considering a home with an HOA, buyers should work to understand what benefits it provides like maintenance, security, or communal amenities, and how the HOA fees factor into their overall budget."

What type of homes are more likely to have an HOA?
Newly constructed homes are much more likely than existing homes to be subject to HOA dues. Among homes for sale on Realtor.com^® in 2024, 69.9% of new builds came with a monthly obligation to the homeowners' association compared to 37.1% of existing homes.

Much like the splits between new construction and existing homes, HOA dues are much more widespread among condo, rowhome, and townhome listings (from here on referred to collectively as condos) than single family homes. 83.8% of condos for sale in 2024 had HOA dues associated, while just 33.6% of single family homes did.

Where are buyers most likely to be hit with an HOA fee on the home that they purchase? Areas with a high concentration of new construction or a high concentration of condo units, especially in desirable beach or ski markets. Below are the ten metropolitan areas with the highest share of for-sale listings subject to HOA dues.

Metro Area	Share of Listings with HOA	Median Monthly HOA Dues
Edwards, Colo.	89.9 %	$525
Myrtle Beach-Conway-North Myrtle Beach, S.C. and N.C.	84.8 %	$138
Heber, Utah	83.3 %	$300
Lakeland-Winter Haven, Fla.	79.7 %	$78
Orlando-Kissimmee-Sanford, Fla.	78.4 %	$164
Boise City, Idaho	77.6 %	$54
Las Vegas-Henderson-Paradise, Nev.	77.1 %	$118
Jackson, Wyo.	77.0 %	$250
Houston-The Woodlands-Sugar Land, Texas	76.8 %	$67
North Port-Sarasota-Bradenton, Fla.	76.0 %	$310

 

Where can savvy buyers avoid paying a monthly fee to an HOA? Smaller markets with fewer newly-built homes and condos, mostly in further inland markets. Below are the 10 metropolitan areas with the lowest share of for-sale listings subject to HOA dues.

Metro Area	Share of Listings with HOA	Median Monthly HOA Dues
Anniston-Oxford, Ala.	3.8 %	$29
Elizabethtown-Fort Knox, Ky.	5.0 %	$19
Jonesboro, Ark.	5.3 %	$36
Monroe, La.	5.8 %	$30
Huntington-Ashland, W.Va., Ohio, Ky.	6.1 %	$25
Albany-Lebanon, Ore.	6.2 %	$33
Merced, Calif.	6.2 %	$137
Ukiah, Calif.	6.5 %	$131
Vineland-Bridgeton, N.J.	6.8 %	$77
Orangeburg, S.C.	7.1 %	$104

To read the full report and learn more: www.realtor.com/research/homeowners-associations-2024

Methodology
This report aggregates weekly snapshots of all for-sale listings in the United States on Realtor.com in 2024 and in 2023 for year-over-year comparison. Listings are considered to be subject to an HOA if they have a monthly HOA fee greater than zero dollars published on them. Median monthly HOA dues calculations for a given geography or listing segment include only nonzero HOA dues (i.e. listings without HOA dues are not included as zeroes). The terms "HOA fees" and "HOA dues" are used interchangeably here.

About Realtor.com^®
Realtor.com^® is an open real estate marketplace built for everyone. Realtor.com^® pioneered the world of digital real estate more than 25 years ago. Today, through its website and mobile apps, Realtor.com^® is a trusted guide for consumers, empowering more people to find their way home by breaking down barriers, helping them make the right connections, and creating confidence through expert insights and guidance. For professionals, Realtor.com^® is a trusted partner for business growth, offering consumer connections and branding solutions that help them succeed in today's on-demand world. Realtor.com^® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com^®.

Media contact: Mallory Micetich, press@realtor.com

View original content:https://www.prnewswire.com/news-releases/rising-hoa-dues-add-to-homeowners-affordability-challenges-302350979.html

SOURCE Realtor.com

FAQ

What is the median monthly HOA fee in 2024 according to Realtor.com?

According to Realtor.com, the median monthly HOA fee in 2024 is $125, up from $110 in the previous year.

Which US city has the highest percentage of HOA fees in 2024?

Edwards, Colorado has the highest percentage of HOA fees with 89.9% of listings having HOA dues and a median monthly fee of $525.

What percentage of new construction homes have HOA fees in 2024?

69.9% of new construction homes have HOA fees in 2024, compared to 37.1% of existing homes.

Which type of properties are most likely to have HOA fees?

Condos, rowhomes, and townhomes are most likely to have HOA fees, with 83.8% of these properties having HOA dues in 2024, compared to 33.6% of single-family homes.

What city has the lowest HOA fees in 2024?

Elizabethtown-Fort Knox, Kentucky has among the lowest HOA fees with a median monthly fee of $19 and only 5% of listings having HOA dues.