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August 2020

Growing number of homeowners are part of community associations

August 6, 2020

Regardless of which metric is used, community associations are on a growth trajectory.

About two-thirds (66%) of new home construction this year will be in a community association, resulting in the creation of 2,500-3,000 new associations.

By year-end, the Foundation for Community Association Research estimates there will be 352,000 to 354,000 U.S. community associations with 73.9 million residents. That means approximately 25-to-27% of this country's residents are part of a planned community, condominium community or housing cooperative. In 1970, there were only 10,000 associations with around 2.1 million residents.

(A Community Association is defined as a legal entity in which the owners enjoy the protection, enhancement, maintenance, and preservation of their homes and property. Membership is mandatory for all owners and every owner is subject to "mutually binding documents" and mandatory lien-based assessments, often referred to as maintenance fees.)

Washington state ranked 9th in the U.S. in 2018 based on its count of 10,450 associations. An estimated 2,345,000 (about 31% of the state's population) live in associations, according to the latest Community Association Fact Book.

Measured by market value, the association housing component was valued at approximately $6.288 trillion as of Q4 2018. Within Washington, the market value is pegged at around $218.5 billion.

In its Fact Book, the Community Associations Institute also estimates association owners spent around $250.5 billion on home improvements and maintenance during 2018.

The economic contributions of community associations totaled $265,688,300,000 in 2018, including the following categories:

Volunteer Leadership and Governance (legal & fiduciary requirements)........... $2,288,600,000

Homeowner Property Tax Payments.............................................................. $72,753,700,000

Homeowner improvements within their own unit.......................................... $67,646,000,000

Association Housing Services (e.g. major repairs, replacements, capital improvements)............................................................................................ $123,000,000,000

The Foundation for Community Association Research, created in 1975, provides an array of research-based information for homeowners, association board members, community managers, developers, and others. In addition to Fact Books, the organization publishes a newsletter, Catalyst, and various Best Practices Reports.

The Foundation also supports Community Associations Institute (CAI), a national organization that provides education and resources to the volunteer homeowners who govern community associations and the professionals who support them. Along with educational offerings, CAI engages in advocacy at both the federal and state levels.