A neighborhood association (NA) is a group of residents or property owners who advocate for or organize activities within a neighborhood. An association may have elected leaders and voluntary dues.
Some neighborhood associations in the United States are incorporated, may be recognized by the Internal Revenue Service as 501(c)(4) nonprofit organization, and may enjoy freedom from taxation from their home state.
The term neighborhood association is sometimes incorrectly used instead of homeowners association (HOA). But neighborhood associations are not homeowners associations (HOA). An HOA is a group of property owners with the legal authority to enforce rules and regulations that focus on restrictions and building and safety issues. On the other hand, a neighborhood association is a group of neighbors and business owners who work together for changes and improvements such as neighborhood safety, beautification and social activities. They reinforce rules and regulations through education, peer pressure and by looking out for each other. Some key differences include:
The rules for formation of a neighborhood association in the United States are sometimes regulated at the city or state level.
Neighborhood associations are more likely to be formed in older, established neighborhoods, whereas HOAs are generally established at the time a residential neighborhood is built and sold.
In some cases, neighborhood associations exist simultaneously with HOAs, and each may not encompass identical boundaries. In one example, newer infill neighborhoods built decades after the original, surrounding HOA-less neighborhood may have its own HOA but also be within the boundaries of a NA.