Why Are HOA Fees So High, and Will They Keep Going Up?

Why are HOA fees so high? If your dues have jumped, you are not imagining it. Realtor.com data reported by the Wall Street Journal shows median condo fees up 29% and single-family HOA fees up 26% since 2019. In Florida, some owners have seen far steeper increases. The causes are not mysterious: insurance, new safety and reserve laws, tighter lending rules, and the rising cost of the work associations pay for.

I build the software that produces reserve study funding plans, so I spend a lot of time on one cause in particular: reserves that were underfunded for years and are now being caught up. This guide explains each driver and how to tell whether your association's increase makes sense.

Here is what matters most:

• Insurance is the biggest recent driver for many associations, especially condos and especially in Florida, where premiums have risen sharply and some carriers have stopped writing policies.
• New laws after the Surfside collapse require structural inspections and reserve funding in Florida and New Jersey, which forced many associations to raise dues.
• Lenders are tightening too: Fannie Mae's condo reserve minimum rises from 10% to 15% of the budget for loan applications from January 4, 2027.
• Construction and labor costs raise the price of every repair and replacement reserves must pay for.
• Many increases are catch-up: associations that kept dues artificially low for years are now funding reserves they should have funded all along.

1. Insurance

Associations buy property insurance for the buildings and common areas, plus liability and other coverage. In many markets, premiums have climbed steeply. Florida is the clearest case: reporting on Florida condos points to property insurance as a primary driver of rising fees, with some buildings facing large renewals and some carriers declining to quote at all. Coastal and older buildings, and those with claims history, tend to see the largest increases.

Insurance is usually part of the operating budget, so a premium increase flows straight into monthly dues.

2. New safety and reserve laws

After the Champlain Towers South collapse in 2021, Florida required milestone structural inspections and structural integrity reserve studies for condo buildings three or more habitable stories tall, and barred associations from waiving reserves for structural items. To comply, many associations raised dues and some levied large special assessments. A 2025 law added some flexibility, but the obligation to fund structural reserves remains.

New Jersey followed with a 2024 law requiring structural inspections for covered buildings and capital reserve studies every five years with a 30-year funding plan.

See our guides to the Florida SIRS report and New Jersey condo law.

3. Lender rules

When buyers finance condos with conventional mortgages, lenders review the building's budget and reserves. Fannie Mae's Lender Letter LL-2026-03 raises the minimum reserve allocation from 10% to 15% of budgeted assessment income for loan applications dated on or after January 4, 2027. A survey cited by industry press found more than half of responding condo communities planned to raise regular assessments to meet higher reserve requirements. See our guide to Fannie Mae condo reserve requirements.

4. Construction and labor costs

Reserves pay for roofs, paving, painting, elevators and mechanical systems. When construction costs rise, every future replacement costs more, and the reserve study's recommended contribution rises with it. Landscaping, cleaning, security and management contracts also rise with labor costs.

5. Years of underfunding

This is the cause owners rarely hear about. Some boards kept dues low by contributing less to reserves than their reserve study recommended. That feels good at budget time and works until a big replacement comes due. When it does, or when a new law or lender rule requires proper funding, the association has to catch up quickly, through higher dues, a special assessment or both.

In practice, a "sudden" increase is often the bill for years of savings that never happened.

How to tell if your HOA fee increase is fair

Ask the board for three documents and check three things.

1. The budget. How much of the increase is insurance, how much is operations, and how much is reserves?
2. The reserve study. Is the reserve contribution in the budget the one the study recommends? Is the study current?
3. The 30-year cash flow. At the new contribution, does the reserve balance stay positive for 30 years?

If the increase is mostly insurance, it reflects the market. If it is mostly reserves, ask what percent funded the association is and what it will be after the increase. You can check that yourself with our free HOA reserve fund calculator using the numbers from the reserve study.

Will HOA fees keep going up?

For most associations, yes, at least with inflation, because insurance, labor and materials rarely get cheaper. The jump may be larger in states with new reserve laws and in condo buildings facing the 2027 lender rule. The associations that see the smallest increases over time are the ones that fund reserves steadily to their study, because they avoid the catch-up spikes.

What boards can do to keep increases predictable

1. Fund reserves to the study every year, even when it is unpopular. Small, steady increases are easier for owners than one large jump.
2. Shop insurance early and ask your broker which building improvements would lower premiums.
3. Update the reserve study on schedule so costs reflect current prices and nothing surprises you.
4. Show owners the 30-year cash flow when you explain an increase. People accept a rise more readily when they can see the roof it pays for.

Frequently asked questions

Why did my HOA fees go up so much?

The most common reasons are higher insurance premiums, new state laws requiring structural inspections and reserve funding, tighter lender rules for condos, rising construction and labor costs, and catching up on reserves that were underfunded in past years. Your board's budget should show which items increased.

Can an HOA raise fees without a vote?

Often yes, within limits. Many governing documents let the board adopt the annual budget, and some states cap increases without owner approval. California, for example, limits regular assessment increases and special assessments without a member vote. Check your governing documents and state law.

Are high HOA fees a bad sign?

Not necessarily. Fees that fully fund reserves can be a good sign, because they reduce the risk of special assessments. Very low fees compared with similar communities can be a warning sign that reserves are underfunded.

Do HOA fees ever go down?

Occasionally, for example after a large project is paid off or insurance costs fall. More often they rise with inflation. Steady, predictable increases are usually healthier than flat fees followed by a large jump.