A temporary agreement by the US Government is just that temporary, but nothing fixes the problem. Our government has to reduce spending, raise interest rates, and lower its investing. Which means the state will not get money they have become dependant upon. This puts states and cities at risk of defaulting and higher taxes. City and state building contracts would be greatly reduced causing businesses to lay off employees or close their doors all together. This means more bank defaults, bankruptcies, unemployed, mortgage defaults, higher taxes, new tax laws, etc.
For communities which for practical purposes are quasi cities this means facing a second mortgage crises. More foreclosures, past due dues, unpaid fines, even default by the associations, lay offs, bank owned homes not being maintained or even demolished, lower property values, and association property not being maintained. But, act vigilantly now to reduce any effects that may or could come to pass.
Reduce your monthly expenses, follow your reserve study to the letter, & do an inspection to look for potential problems. Even if you are going to do reserve expenses yourself to reduce the cost; do not do it out of order. If you are behind on your replacements get them up to date. Safe guard reserve funds by creating individual accounts for each year of replacements and putting the remainder in a checking or savings account. The first crisis didn't bring the cheap contractor prices expected or reduced prices on bank owned homes. We have seen higher oil prices, food prices, vehicle tire prices, and scams by contractors trying to make a buck.
Set aside money in the budget for that freak act of nature like we saw in AZ. You know, hail! Who would have ever thought hail in Arizona. It did and the damage was great. Insurance paid out on the damage, but for some associations the number of claims could be a make it or break it thing. At least set aside your deductible amount just in case. If the claim isn't substantially more than the deductible, do not claim it just pay it out.
Budget for dues only and even deduct say 3 or 5% for dues owed in the current year but not paid until the next year. Allow for a cushion to absorb unexpected hits. If it's not needed then set aside in a separate account for an improvement or refund that is voted on and approved by the membership.
Just don't buy into the propaganda sold by the FED and economist that says the economy is improving. This is a tactic used back in the 20's to keep people from running to the bank and pulling out all their money. They tell you to spend spend spend like there is no tomorrow to prevent banks from failing. Somewhere along the line they forgot the citizens built this country not the corporations or profiteers. Somewhere along the line the people forgot that our government works for us and they must be supervised. We must still believe that people in Washington are honest farm workers and that is just not true. If it were, they would not be trying to tell us that the economy is bouncing back. As they fight over a debt ceiling to prevent defaulting. If the individual is financially sound companies they own are too. We shouldn't be worried about the huge corporations since it is the mom and pop companies that built this country. Currently, we should be loaning only to US citizens, buying US made products only (not product of the US grown in Mexico), and saving more money. Investing too much too fast causes crashes too.
Protect yourselves and your communities. Stay level headed, make decisions based on research, experience, logic and reason, do not give in to emotion based decisions, and do not let anyone rush a decision.
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