After a few months of searching online for the perfect villa on Hilton Head, you’ve found the one you love. It’s got a great view of the ocean, the right amount of bedrooms for your family and it’s already renovated. After imaging where you’ll put your furniture, you ask your agent what the “condo fee” is. Your agent starts throwing strange words around you weren’t expecting like “regime” and “POA.” There are also transfer fees and assessments that you didn’t even know could be part of the equation. Thankfully, your agent has been through this before and can break down and confirm all of the details. However, so that you are not surprised by how the different fees are structured, it’s good to know the following basics in advance.
Regime fees are what are usually called “condo fees.” We call condos “villas,” so of course we’re going to have different name for everything else. Safe to say, most regime fees usually include the following:
- Pool maintenance
- Pest control
- Trash pickup
- Common area maintenance
- Common area utilities
- Common area landscaping
Some regime fees have these premiums included:
- High speed wifi
- Basic cable tv
- Landline phone service
Last but not least, there is insurance. Some complexes have insurance included in the regime fee and some do not. As a result, it's usually the reason why you'll see a large difference in the regime fees of two similarly priced properties. When insurance is not included, owners usually still pay for it as a separate “insurance assessment” that is billed annually or biannually. Keep in mind that the insurance billed is typically for the building’s exterior and the common areas. Some also include protection for the villa's interior up to the quality of the original construction. To thoroughly protect the interior, which includes personal property and any upgrades made to the unit, owners are encouraged to purchase a separate HO6 policy.
What’s the best way to confirm how much a regime fee is and what it includes? Ask your agent. Why can’t it be as simple as checking the listing report? As my grandmother used to say, “don’t ask.” The fees change every year and often the information provided by owners is either incorrect or incomplete. That’s why it’s best to have your agent contact the property management company that oversees the complex and have them confirm the details in writing. Make sure your agent also confirms if there are any ongoing or planned assessments for the complex.
The regime fee may not be the only ongoing fee you’ll pay for living in your new villa. There is also something called a “POA fee,” which is another way of describing an “HOA fee.” Whereas the regime fee is what you pay to live in a villa complex, the POA fee is the fee you pay for living in an overall community. For example, if you live in villa complex like Turtle Lane Club in Sea Pines, you’ll pay the regime fee for Turtle Lane Club and a POA fee for living in Sea Pines.
Some communities also have a “transfer fee,” which is a one-time fee paid at closing. Some transfer fees are a small percentage of the sales price, others are a flat fee. As of this writing, Palmetto Dunes, Shipyard, Indigo Run, Hilton Head Plantation and Leamington villas "inside the gates" have transfer fees. Sea Pines, Forest Beach, Folly Field, Windmill Harbour and the Leamington villas “outside of the gates” do not. The other Hilton Head communities that I’m not including here don’t have villas. Aside from community transfer fees, the Town of Hilton Head Island has it's own one-time transfer fee of 1/4 of 1% of the purchase price.
While it’s quite a few items to keep track of, most buyers will decide on a community early on and then target the complex. As a result, you’ll likely know the POA and transfer fee towards the start of your search and then just need to know the regime fee details, how insurance is billed and if there any assessments. Feel free to contact us with any questions.