Waiver of Assessments for Common Areas or Maintenance Areas

DRE Regulations allow for HOA assessments to be waived for HOA-maintained improvements that are not complete. Regulation 2792.16c, in a nutshell, allows a complete deferment of costs associated with improvements that are not being maintained by the HOA.  It’s actually illegal for the HOA to charge assessments for expenses that they do not incur.

IF the CCRs allow for this deferment of assessments, the HOA manager should be made aware of the provision.  For projects where construction of HOA-maintained improvements is phased or delayed, it can literally shave thousands of dollars in assessments.  This is particularly important to understand when the HOA maintains roofs and exteriors of attached dwellings where the buildings are not complete.

The regulation provides a list of examples but, for HOA management and oversight, the facts are simple:  any costs for maintenance and reserves associated with an improvement that is not complete are literally erased from the HOA budget.  Having these provisions in your CCRs up front can help you avoid having to re-phase your development when a market slowdown occurs.  If your CCRs don’t include the provision, then you should make sure it is included in any Annexation document!

For specific examples of how this provision can benefit you on a given project, please call us.  It is not unusual or unlikely to eliminate thousands of dollars each month from the budget – particularly when the buildings are maintained by the HOA.

Here is the hyperlink to the law.

Hi, I'm Scott

I'd love to learn more about your new development or project. Use the link below to request a proposal.


Stay up to date.

Sign up our newsletter for latest article and news.
property What You Need to Know About Subdividing Land Today

Subdividing Land: What You Need to Know

As the world population continues to grow, the demand for land will only increase. By subdividing land into multiple usable lots, the possibility of reaping additional profits is highly likely. This has led many people to ask the question, “How do I subdivide land?”

Read More »
Red Flags that Signal Potential Problems with Your Reserve Fund

Red Flags that Signal Potential Problems with Your Reserve Fund

As a homeowner, board member, developer, or community manager, you bear a significant responsibility of ensuring that your community is always in top-notch condition, well-maintained, and prepared for any unexpected situations. One of your primary duties is managing your community’s reserve fund, which serves as a financial buffer to cover any unforeseen expenses or significant repairs.

Read More »
Making Your HOA more attractive for Insurance Companies

Making Your HOA more attractive for Insurance Companies

There are fewer insurance companies willing to write policies for HOAs due to perceived risk. In the events that have taken place in 2022, such as floods and fires, there is a massive deficit in insurance for HOAs. Community association insurance plays a significant role in budgeting for HOAs. Insurance premiums are a necessary expense that HOAs must include in their budget to ensure that the community is protected.

Read More »
Schedule a Call
Discuss your project or needs with someone from the California Builder Services team.