How to Set Up a Homeowners’ Association

When you live in a building with other residents, it is quite normal to set up a homeowners’ association (or HOA) in order to keep up with the maintenance of the building and establish house rules. 

If you have recently bought a new apartment in Barcelona, then it could be that your property hasn’t yet started with the process of setting up a homeowners’ association. At first this might seem a complicated process with lots of steps, but is it actually easier than it looks.

This article by ShBarcelona will tell you about all the steps on how to set up a homeowners’ association, and we will try to answer all your questions concerning the association’s set-up phase.

 

Setting up a homeowners’ association: Is it obligatory?

Let’s start with explaining what it is:

A homeowners’ association is a group of people who own a home and/or other space within a building.

Having a homeowners’ association is not obligatory, but it is highly recommended, because it can avoid future problems with other residents.

Every change when it comes to the property, for example repairs, maintenance works, the opening hours of communal spaces, or the payment of community fees, must be agreed upon by all the owners who attend the homeowners’ association meetings.

But what happens if a homeowners’ association hasn’t yet been set up? Without one, each and every resident could live by his own set of rules and make changes to the property without consulting other residents. This could have a negative impact on all the people living in the building.

Related article: 10 Rules For Living in an Apartment Complex

The process of setting up a homeowners’ association

As we have mentioned before, there are some situations when you start living in a building, where a homeowners’ association is not yet active.

This can happen with newly built properties (but als existing ones) where the developer hasn’t yet drawn up the statutes of the homeowners’ association. As a result, the people who are in charge of setting up the homeowners’ association are going to be the homeowners themselves.

We will now tell you about the process and steps:

1. Hold the first HOA meeting

Every homeowner must be present during this first meeting (called Junta Constituyente in Spanish). If not all apartments, parking spaces, or other spaces in the property have been sold, then the developer of the building must also be there to attend the meeting.

During this meeting the initial set up of the HOA is formalised, and then the board of directors will be appointed in accordance with the Ley de Propiedad Horizontal.

• President of the homeowners’ association: He will represent the association, and he has the power to formalise the HOA and legalise the minute book.
• Secretary: This is the person who is in charge of keeping all the documents of the association.
• Treasurer: This person takes care of the association’s accounts.

📌 It it possible that the president also fulfills the roles of treasurer and/or secretary.

Related article: The 6 + 1 Tasks of Property Management Services in Barcelona

Once all the board members have been appointed, the following subjects must be discussed:

• Determining the owners’ fee
• Authorising signatures
• Approving the budget
• Opening an account for direct debit payments
• Answering questions

2. Drawing up the Articles of Incorporation

The Articles of Incorporation (Acta de Constitución) are drawn up during the very first meeting, and they contain all the information and agreements that the attendees at the meeting agreed upon. The names of everyone who was there will be written down, but also, for example, who voted in favour of the association and who didn’t.

It must be signed by the president and the secretary of the homeowners’ association, and then it needs to be submitted to the Spanish Registro de la Propiedad. 

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3. Legalising Minute Book

In order to legalise the minute book (Libro de Actas), first it must be presented totally blank to the Registro de la Propiedad where the property is registered. The minute book comes with a signed request from the president of the HOA, and the whole process will take about a week.

Once the minute book is approved, all the agreements of the homeowners’ association meetings will be written down in this book, and more specifically they will contain the Articles of Incorporation.

This type of book can be bought at any book shop, and it will cost around 20 euros.

4. Getting a NIF

The president should then visit the corresponding Tax Office (Delegación de Hacienda) and apply for the NIF for the homeowners’ association.

Once you are at the office, you will have to fill in and sign form 037 of the Agencia Tributaria, and you will also need to provide the following documentation: 

• Copy of the president’s DNI
• Escritura de División Horizontal of the property
• Copy of appointing the president of the HOA

📌 The Escritura de División Horizontal of the property is a document that states all the necessary information on the HOA. For example: its communal spaces, a description of the apartments in the building, and the owners’ fees. It is important that all the homeowners from the building receive their copy of this document when the association is set up, so they know what is specified in the document.

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What does it cost to set up a HOA?

Although it doesn’t cost very much, the expenses for setting up the homeowners’ assocation will be borne by all homeowners and owners of other spaces inside that property. 

The minute book will be around 20 euros, but together with all the other costs and without giving an exact amount, the total price will be between 100 and 300 euros.

If you have made it to the end of this article, you have seen that setting up a homeowners’ association is not that complicated at all, and that it doesn’t cost the homeowners that much.

Have you ever set up a homeowners’ association in Barcelona before? 
Tell us about your experiences in the comment section below!