While the majority of condo buildings and HOA communities choose to partner with professional management firms to provide guidance and counseling and oversee their day-to-day operations, other boards take the reins themselves and choose self-management. While there are certainly advantages to going the self-managed route, there are also challenges. But with the right preparation and commitment, this large and sometimes intimidating undertaking can be navigated successfully.
Why Go Solo?
Why choose the path less traveled? Sometimes it comes down to the size of the community. “Typically, smaller associations self-manage to save the fees associated with professional management,” says Cheryl Murphy, executive director of the Community Associations Institute–Illinois (CAI-IL) chapter, based in Schaumburg.
“I see it a lot for smaller associations because it is more difficult to find cost-effective management,” says Brad L. Schneider CPA and president of Elmhurst-based CondoCPA. That being said, larger buildings may also find reasons to go it alone. “I also see it when there is a larger association with a highly qualified on-site manager, if they do not feel there is much added value obtained from the management company,” says Schneider.
“The biggest benefit I've found after working with self-managed associations is cost,” agrees attorney Charles T. VanderVennet, whose practice is in Arlington Heights. “However, the associations that decide to [self-manage] must really be willing to put in the time and labor that management would do for an association in order to save that money.”
Another upside is less tangible. “I believe that condos and HOAs are an outstanding example of a ‘We the people, by the people’ approach as envisioned by our founding fathers,” says Michael Baum, PCAM, president of Baum Property Management, based in Aurora. “I absolutely love the concept of like-minded individuals banding together in a community to create the living environment that they prefer. I believe that the roots of common interest communities can be found in the Utopian ideas in the late 1800s and communal living concepts.”