No Mello Roos and HOA good or bad? (Newport Beach, Murrieta: foreclosures, renter)

[venicebeachcalifornia]

I noticed some new communities that specifically say no Mello Roos and HOA. What's the catch because there's no free lunch? Is that a good or bad thing?

[wIregEx]

I like HOA. it keeps the neighborhood clean.

[pacific2]

Originally Posted by venicebeachcalifornia

I noticed some new communities that specifically say no Mello Roos and HOA. What's the catch because there's no free lunch? Is that a good or bad thing?

That's (no Mello-Roos part) a marketing gimmick and they are playing on people's fears since there are some who say, "I'll never pay Mello-Roos!" Rumors abound and a lot of impressionable people make decisions based upon what they have heard and don't take the time needed to do their own research.

Always check total costs before making a decision because a comparable Mello-Roos home may have a much lower asking price.

Additionally, some Mello-Roos free communities levy a variety of, sometimes hefty, special fees or assessments.

Consider the asking price AND also enter the address at the county tax assessor's site to get a breakdown of the tax bill.

Regarding HOA, that's a choice you'll have to make when looking at the total package (actual fees, amenities, location, etc.).

You're right, there's no such thing as a free lunch, except maybe for the realtor who picks up a bigger commission by selling the higher priced home.

[bhcompy]

If it's infill, there won't be mello roos and it may be too small for an hoa?

[expatCA]

Originally Posted by venicebeachcalifornia

I noticed some new communities that specifically say no Mello Roos and HOA. What's the catch because there's no free lunch? Is that a good or bad thing?

Mello Roos are assessments. They raise the monthly payment without raising the value of the house. When we bought our house in Murrieta we had a choice between two virtually identical houses. They both had the same monthly payment, including taxes and such, but the one with the Mello Roos was in a less desirable area and actually was listed for a lower price. We bought the better deal and it had better equity. Sold it as well for normal appreciation in 2008. The other neighborhood had far more foreclosures due to the higher payment with lower value.

HOA's depend on if you want an association or not. Some do some don't. I don't.

[EscapeCalifornia]

Interest and property taxes are tax-deductible. MR and HOA aren't. If you're going to spend one way or the other, at least favor deductible expenses.

[kwong7]

I'm not certain about MR, but HOA fees are deductible from your profit basis if you sell for a profit. While I support the idea of MR & HOAs, I think all potential buyers should be educated on what they do and how they impact the community. Roads, sanitation, education, parks, and infrastructure can be a huge burden to growing cities (it bloats their budgets) so in order to provide desirable services without raising property taxes, folks have to get a little creative. It boils down to what kind of community you want to live, support, and by which you would like to be supported.

Full disclosure, I live in an HOA/MR free area of Newport Beach and it fits me well.

[bhcompy]

Originally Posted by kwong7

I'm not certain about MR, but HOA fees are deductible from your profit basis if you sell for a profit. While I support the idea of MR & HOAs, I think all potential buyers should be educated on what they do and how they impact the community. Roads, sanitation, education, parks, and infrastructure can be a huge burden to growing cities (it bloats their budgets) so in order to provide desirable services without raising property taxes, folks have to get a little creative. It boils down to what kind of community you want to live, support, and by which you would like to be supported.

Full disclosure, I live in an HOA/MR free area of Newport Beach and it fits me well.

Which is fine out in the IE where they were turning farm/ranch land into neighborhoods, but it's not necessary in the vast majority of OC because they aren't growing cities

[LordOfTheCars]

Originally Posted by wIregEx

I like HOA. it keeps the neighborhood clean.

Look at a neighborhood with out them that has long tem OWNERS not renters... you will see that the properties are cared for.

HOA? Why be treated like a renter in your own home?

[wIregEx]

Originally Posted by LordOfTheCars

Look at a neighborhood with out them that has long tem OWNERS not renters... you will see that the properties are cared for.

HOA? Why be treated like a renter in your own home?

say that after your neighbor paints his home Yellow or when his son's tree house blocking the view & sunlight.