Abstract
Objective. This study evaluates the impact of residential community associations (RCAs) on RCA property values by testing competing theoretical expectations about the efficiency and accountability of RCAs with empirical evidence.Method. We use pooled data on 195 units in six RCAs in one city, regressing sales price on RCA fees, a proxy for the importance of professional management compared to community involvement, previous property values, and other variables.Results. We find that increases in RCA fees (and services) depress average property values over what they would be otherwise, and that professional management somewhat mitigates this effect by raising property values.Conclusion. RCAs with horizontal, community controls act as if they are governed by a high‐demand, volunteer, review group by producing and charging too much, while professional management (i.e., hierarchical control) slightly reduces the tendency of RCAs to produce and charge too much. RCAs may not be the model of efficiency that proponents of private governments expect.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
