How Much Should We Pay for Association Dues?

How much Homeowners Association (HOA) fees should we really pay monthly? It is a question that lingers everytime we  have a property inside a gated community such as Lancaster Residences. LR, as we usually call it, is a 7-phase project inside Lancaster New City Cavite. This article is a guide to know if a community is over-charged.



It has been almost nine years ago since we moved in to Lancaster. We remembered back then, there was no street lights yet, no amenities, no basketball court. Except for one "clubhouse" that we could not even use because it is always closed and used for "trippings" of real-estate agents so that they can sell units in Lancaster New City Cavite. Security guards are evident, but they only guard the construction materials and manpower of the real estate developer that goes in and out of the village.

Back then, we already have a HOA... which means Homeowners Association. And we pay up to Php 300 per month without knowing where our money is being spent. Later on, we found out that we are automatically a member of a Homeowners Association that is controlled by the employees of the developer, Pro-Friends, because of the Master Deed with Declarations of Restrictions of Lancaster Estates  to which they used as a weapon to charge us with association fees when there is virtually few homeowners in our community and the HOA directors are all employees of the real estate developer (see How LEHOA was "legalized" to be controlled by the real-estate developer).

Then we later found out this undertaking was against the law because any contract made in contradiction with the law (PD957 and RA9904, for this matter) is null and void (see HLURB Mocks the Magna Carta of Homeowners Association)

And so to get around the law, this real estate developer gave away property titles to its employee / directors to make them "homeowners" in 2015. But they still forgot one thing: Section 34 of HLURB Resolution 770 on Homeowners Associations specifically states that "directors should be free from any business or other relationship that could materially interfere with the exercise of their independent judgment" yet, these employees-made-homeowners are STILL employees of the real-estate developer which hinders their impartiality to make decisions solely beneficial to the community; and not to their business of selling homes and making money out of the people.

To cut the long story short, we, the homeowners, are being stabbed at the back by un-elected, and fake directors of our homeowners association, backed by illegal contracts and a passive and useless quasi-judicial entity of the government called HLURB for nine years now.


Because this fake HOA is not releasing audited financial reports to its supposed constituents since they have begun collecting fees from the homeowners, we have released an article five years ago regarding a comparison of the HOA Dues we have at Lancaster Residences to give light to the fees this HOA is charging us. There were so many useless breakdowns they made, as if they want to charge a single division in the real-estate developers' offices from the pockets of their own customers who have incidentally already paid for their houses.

Now that most infrastructure and most of the units area already occupied, and with the absence of an audited financial report, it would be best to estimate the cost of running basic services of a HOA and see if we are over charged and how much is collected in excess.

The basic services a HOA can offer is paying for the lighting from MERALCO electric poles, and security services. Garbage collection is supposed to have been already paid from real estate property taxes we pay annually through RA 7160 or the Local Government Code of 1991 so this should no longer be added.

Assuming we pay P14,000 monthly salary to each security personnel and a Php 520 per lit electric pole in the community, we can provide an estimate of the basic cost of running a HOA. From this we can see if we are over-charged by getting the number of units and association fee per unit owner.

In Lancaster Residences, there are about 446 Villas units which are charged P220/month and 2,410 Manor units which are charged P300/month.

HOA collection estimates and basic services cost in Lancaster Residences

Since 2010, the real-estate developer-controlled HOA is potentially collecting a total Php 821,120 per month in Lancaster Residences alone, or over Php 9.8 million per year  for administering a measly 21-hectare of land with only three (3) insufficiently lit and uncovered basketball courts, twice-a-week garbage collection (supposedly covered by the local government), 5-8 security guards on a 12-hour shift, and 120 lit electrical poles. It seems we can live with only P110 HOA fees and not a whopping Php 300.

Estimated cost of running the HOA in Lancaster Residences is about Php 284,000 which entails about Php 537,720 of excess funds collected per month or over Php 6.4 million excess collections per year.

Where does the six million pesos (Php 6,000,000) excess per year goes to?  I don't know, and neither do you. Because never did these directors release an audited financial report to us over the decade of this HOA's existence.


Let's help the others too by checking out other phases in Lancaster New City Cavite.

Kensington 13 and Kensington 19 HOA Estimates

Manchester 8, 11, 12 HOA Estimates

Kensington 1 HOA Estimates

Lancaster Village 2 HOA Estimates

As we have noticed there are hundreds of thousands to over a few million pesos excess charges from the estimates per phase by this HOA. There are over 70 phases in Lancaster New City Cavite. The excess collections could be very staggering if multiplied to the number of phases!

Take note that these calculations are based on basic services and current infrastructure available. And a HOA can decide on adding many other services and costs to their responsibilities, PROVIDED, they are discussed among the homeowners and approved by its majority. The question is, was there any discussion and approval that took place to arrive at such a value we are forced to pay every month? I don't think so.


Related Articles:

• Homeowners Dues Illegally Being Collected by the Developer
  This article discusses the legality of HOA dues collection in Lancaster Residences by LEHOA
• LEHOA Bylaws and PD957 and RA9904
  The article explains PD957 and RA9904 which are the tenets of law for homeowners associations and compares the bylaws promulgated by LEHOA
• How LEHOA was "legalized" to be controlled by the real-estate developer.
  This article explains how LEHOA was legalized amidst all odds.
• Estimated Collections of LEHOA
  This article gives an overview of the potential collection generation of LEHOA in comparison with other subdivisions.