We analyzed eight real HOA and condo financial report sets using HOA Report's document-based scoring system. The goal was not to call out any specific association. The names and identifying details have been removed. Instead, we wanted to show the kinds of patterns that owners and buyers should look for before relying on the monthly fee alone.
Important note: These examples are informational only. HOA Report is not legal, financial, accounting, insurance, engineering, or real estate advice. Scores are based only on the documents reviewed and may change if additional documents are provided.
The Score Range Was Wider Than Expected
Across the eight anonymized associations, scores ranged from 38/100 to 66/100.
That means every report had something worth reviewing, but the reasons varied. Some associations had balanced budgets but weak reserves. Others had decent reserve planning but very high insurance costs. Several had special assessments tied to structural or reserve funding needs.
The important lesson is simple: a score is not just about whether the budget balances. It is about whether the association appears prepared for the next major repair, insurance renewal, reserve requirement, or special assessment.
Red Flag #1: A Balanced Budget Does Not Always Mean Low Risk
Several associations had budgets that balanced to zero. On paper, income matched expenses. That sounds good, but it can hide pressure.
A budget can be balanced because monthly assessments were increased, reserve contributions were reduced, special assessments were added, or future projects were pushed into another funding bucket.
In one example, the budget balanced, but the report still flagged high insurance costs and limited cash visibility. In another, the budget balanced after a prior operating shortfall had been covered by a special assessment.
- Did the budget balance because fees increased materially?
- Were reserve contributions increased, reduced, or moved around?
- Is there a separate special assessment paying for projects?
- Are actual expenses running above budget?
- Does the association have enough operating cash, or is it just breaking even on paper?
Red Flag #2: Insurance Is Becoming One of the Biggest HOA Cost Drivers
Insurance showed up again and again as a major issue. In the reports reviewed, insurance commonly represented roughly 20% to 37% of operating expenses.
Some reports also flagged premium financing, large deductibles, unknown coverage limits, or missing insurance declaration pages.
That matters because insurance is not a small optional line item. For coastal Florida condos especially, insurance can become one of the biggest drivers of future dues increases.
- What percentage of the operating budget goes to insurance?
- Did insurance increase year over year?
- Are premiums being financed?
- What are the wind, flood, named-storm, and all-other-perils deductibles?
- Are the coverage limits enough relative to replacement cost?
- Are policy declaration pages available?
Red Flag #3: Low Reserves Can Turn Into Special Assessments
Reserve funding was one of the biggest differences between stronger and weaker reports. Some associations had updated reserve studies and meaningful annual contributions. Others showed very low reserve funding compared with projected needs.
In one anonymized example, reserves appeared to be only about 8% funded against the fully funded target. In another, reserves were about 11% funded against identified reserve needs. Both reports raised concerns about future special assessment risk.
That does not automatically mean an association is mismanaged. But it does mean owners should look deeper.
- Is there a current reserve study or SIRS report?
- What percent funded are the reserves?
- How much cash is actually in reserve accounts?
- Are SIRS and non-SIRS reserves tracked separately?
- Are there major projects scheduled in the next 1-5 years?
- Does the reserve study recommend special assessments?
- Are reserve contributions enough to follow the funding plan?
Red Flag #4: Special Assessments Are Not Always Obvious From the Listing
Several reports showed active, recent, or likely special assessment pressure. Some were tied to structural or SIRS requirements. Others were tied to operating shortfalls, insurance pressure, restoration projects, or deferred capital work.
A listing may show the monthly HOA fee, but it may not clearly explain whether a special assessment is active, whether more assessments are being considered, whether a prior assessment is still being collected, or whether owners are paying separately for SIRS or structural work.
Before buying, ask for the assessment schedule, board resolutions, meeting minutes, reserve study, and current financial package.
Red Flag #5: Missing Documents Can Be a Red Flag by Themselves
One of the most common patterns was not a scary number. It was missing information.
Several reports could not fully assess cash, receivables, insurance adequacy, litigation, or delinquency risk because key documents were missing.
If you only have the budget, you may know what the association plans to spend. But you may not know whether it has cash, whether owners are paying on time, whether insurance coverage is adequate, or whether reserves are actually funded.
- Current balance sheet
- Year-end financial statements or audit
- Reserve study or SIRS report
- Insurance declaration pages
- Accounts receivable aging
- Special assessment notices and schedules
- Meeting minutes
- Litigation or claims disclosures
- Structural or milestone inspection reports
Red Flag #6: High Fees Are Not Always the Problem. Fee Pressure Is.
One of the biggest mistakes owners and buyers make is focusing only on the current monthly fee.
The better question is: Is the current fee sustainable?
A high fee may be justified if the association is properly funding reserves, paying for insurance, maintaining the building, and avoiding surprise assessments. A low fee may be risky if reserves are underfunded, insurance is rising, maintenance is deferred, and major projects are coming due.
- High insurance as a share of the budget
- Large reserve catch-up contributions
- Active or likely special assessments
- Prior operating deficits
- Thin operating cash
- Reduced contingency buffers
- Major structural or waterproofing projects
- Unknown delinquency or receivable risk
What Owners and Buyers Should Do Next
If you are reviewing an HOA, condo, or co-op, do not stop at the monthly fee. Start with the core documents, then ask whether reserves are adequately funded, insurance is becoming a major cost burden, special assessments are active or planned, the operating budget is sustainable, key documents are missing, and major repairs are coming due soon.
That is exactly what HOA Report is designed to help with. Upload your HOA documents and get a plain-English financial health report covering reserves, insurance, operating cash, special assessment risk, fee pressure, and missing-document gaps.
Final Takeaway
The biggest lesson from these eight reports is that HOA risk rarely comes from one line item. It usually comes from a combination of things:
- Insurance rising faster than expected
- Reserves lagging behind capital needs
- Special assessments filling funding gaps
- Budgets balancing with little cushion
- Missing documents hiding important context
- Structural or SIRS requirements pushing costs forward
The monthly HOA fee tells you what owners are paying now. The documents tell you what owners may have to pay next.