President’s Report by Joan Dzuro

SCSH Community/Coachella Valley HOA Study

A study was recently completed by John Hoffner, a new resident of SCSH, at his initiative, which analyzed the management structures of HOAs in the Coachella Valley and the financial performance comparisons of SCSH HOA to some other HOA-owned golf communities of similar size and composition of amenities. The Board has reviewed this study, has had it validated by the independent Certified Public Accounting firm of Baltes & Associates, believes it provides helpful, fact-based information about HOA management and our community, and as such, has authorized its publication and distribution to all residents.

John Hoffner: “As a new resident, I felt it was important to obtain some facts about how our community compares to others, and how other HOAs in the Coachella Valley are managed, so residents could make informed and knowledgeable decisions about living here. I undertook the study with no pre-conceived ideas or point of view, and with no influence from any group or entity. My singular objective was to provide all of my SCSH friends and neighbors with some objective, non-personal, and big-picture information which could serve to make all of us more informed and bring us closer together.”

A summary of the Study Highlights is as follows:

  1. There are approximately 550 HOA communities in the Coachella Valley.
  2. Roughly 95% of them are managed by professional management companies.
  3. About 5% of them are self-managed.
  4. Approximately 85% of all professionally managed HOAs are managed by just 8 firms.
  5. Those firms are Personalized Property Management (113); Associa/PCM (95); Desert (60); J&W (55); Joanne Allen (47); Management Trust (38); Albert (27); and Avail (19).
  6. Of these firms, Associa/PCM has the second largest market share and arguably the most prominent HOA client list: SCSH, Toscana, Thunderbird, Rancho La Quinta, Traditions, Hideaway, Rancho Las Palmas, Tamarisk, Palm Valley, Woodhaven, and Madison Estates.
  7. Some of the most prominent self-managed HOAs are: Sun City Palm Desert, Heritage Palms, The Lakes, Big Horn, and Marrakesh.
  8. Approximately 58 HOA communities owned one or more full size golf courses.
  9. In these HOA golf communities, monthly HOA fees ranged from $217 to $1,100.
  10. The golf communities with the lowest monthly HOA Fees were: SCSH $217; Sun Lakes $236; SC Palm Desert $239; Portola $278; Golf Club at La Quinta $288; Indian Springs $290; Thunderbird $292; The Palms $335; Heritage Palms $350; Avondale $363; and Palm Desert Resort $390.
  11. SCSH monthly HOA Fees are the lowest of any HOA golf community in the Valley and are about 35% below the CV HOA Fees average, according to a recent article in the Desert Sun.
  12. Four HOA golf communities with characteristics similar to SCSH were also compared: SCSH, SC Palm Desert, Sun Lakes, and Heritage Palms. Two were professionally managed – Sun Lakes and SCSH. Two were self-managed – Heritage Palms and SCPD.
  13. Monthly HOA Fees of these four HOA golf communities are: SCSH $217, Sun Lakes $236, SCPD $239, and Heritage Palms $350.
  14. Reserves Funding Levels of these four HOA golf communities are: SCSH 90%, Sun Lakes 78%, Heritage Palms 65%, and SCPD 56%.
  15. A comparison of the 2014 audited financial statements and 2015 operating budgets for these four HOA golf communities on: Monthly HOA Fees, Reserves Funding, G&A Admin Expense % of Revenues, and Surplus or Deficit % of Revenues showed the following:
  • SCSH had the highest Operating Surplus % of Revenues of these four communities.
  • SCSH had the lowest G&A Admin Expense % of Revenues.
  • SCSH had the highest Reserves Funding Level.
  • SCSH had the lowest Monthly HOA Fees, and the lowest Fees of any HOA golf community in the Valley.

The two professionally managed communities have the lowest monthly HOA Fees, the lowest G&A Admin Expense % of Revenues, and the highest Reserves Funding Levels.

The two self-managed communities have the highest monthly HOA Fees, the highest G&A Admin Expense % of Revenues, and the lowest Reserves Funding Levels.

In addition to comparing HOA communities on these fact-based and objective measures, it is also important to evaluate them on the breadth and quality of the amenities and services they offer, as well as on the strength of and results delivered by their Boards and management, to ensure that property values and community desirability have been and will continue to be sustained over time.

In considering both types of measures, it clearly appears that Sun City Shadow Hills compares quite favorably on these important metrics to many other HOA communities; is part of the vast majority of Coachella Valley HOAs which are professionally managed; and is partnered with one of the strongest and most successful management companies in the Coachella Valley.

To learn more about John Hoffner click here

Data Sources:

Coachella Valley Community HOA Listings provided by Equity Title Co. and Gallaudet Properties.  As of 6/18/15.

2014 Audited Financial Statements and 2015 Operating Budgets for 4 communities.

Real Estate Multiple Listing Service for detail on HOA fees, amenities, year built, #units, types, etc.

HOA Community Websites.

Phone calls to management of various HOA Communities.

Real Estate Websites: Jenny Robinson, Team Gaffney, Diane Williamson.

“Coachella Valley HOA Fees among the highest in the U.S.” Desert Sun Sept 11, 2015.