Residential Estate Industry Journal 4 - Page 13

INDUSTRY OVERVIEW Also of particular interest is the financial stability in terms of funds that ARC members currently hold in financial reserves. On average, ARC members have just under R7 million in reserves, which equates to 643 percent of average monthly operating budgets (or 61 percent of average annual operating budgets). HOA Management and Board of Director Breakdown Tight security, beautiful landscaping and wide-ranging amenities often make it easy to forget that HOAs are in fact companies who must comply with the C ompanies Act and/or Sectional Title Management Act (and in some cases common law). HOAs employ professional individuals and/or managing agent companies who ensure that their residents are kept safe, their quality of life is improved and property values are protected. HOAs are also led by a Board of Directors who are volunteer homeowners, elected to protect the best interests of their communities. ARC’s annual survey shows that over 60 percent of ARC members employ between two and 10 staff members. Survey results also show that board of director sizes range from 4.4 to 8 (averaging 6.9). In addition, over 60 percent of ARC members have a building and architectural committee, a financial committee, security committee and landscaping and environmental committee permanently in place. HOA Staff Complement Breakdown 21+ 13.85% 11-20 18.46% 6-10 24.62% 2-5 1 36.92% 6.15% 0% 5% 10% 15% 20% 25% 30% 35% 40% % of Estates who have these committees in place Club Committee 16% 82% Building & Architectural Committee 63% Financial Committee 72% Security Committee 68% Landscaping & Environmental Committee Dispute Resolution Committee Social & Ethics Committee 28% 23% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% PAGE 11