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Does anyone know - if a development has only a few lots or units sold and the majority of lots or units are still unsold, does the developer typically hold the rights to vote the unsold lots or units at Homeowners Association meetings?
Correct, all pending on the original, but most ho ass, do not have the power to take over, until it around 60 to 70% sold, so yes, the builder does have control.
Correct, all pending on the original, but most ho ass, do not have the power to take over, until it around 60 to 70% sold, so yes, the builder does have control.
Thanks for your reply!
In other words, the builder could assess the homeowners for anything s/he wants? Raise the dues to anything s/he wants? Do any projects s/he wants and charge the homeowners for them?
Yes, in my experience the builder/developer retains the control of the association until a certain percentage of the lots are owner occupied. In my old assoc. it was 75% and they had to be occupied. The association is then turned over to the residents once the quota has been met. Usually the builder/developer is the "board" and decides on the rules and regs of the assoc. This can be a very challenging thing if the builder/developer and the current residents do not see eye to eye!
In other words, the builder could assess the homeowners for anything s/he wants? Raise the dues to anything s/he wants? Do any projects s/he wants and charge the homeowners for them?
This is essentially true but would probably not be in the best interests of the builder. If the builder wants to sell the rest of the houses/lots they would not be very smart to add projects/expenses/dues/fees, etc. that would turn away future potential buyers.
This is essentially true but would probably not be in the best interests of the builder. If the builder wants to sell the rest of the houses/lots they would not be very smart to add projects/expenses/dues/fees, etc. that would turn away future potential buyers.
Right.
Actually, I would be more concerned about the possibility of the Developer underassessing the HOA and keeping dues artificially low until the development was sold out or nearly so.
Low dues make it more marketable in the short term.
Also, I would want regular indication that the Developer was making his payments to the HOA in a timely manner, and that he was current.
or has the developer "made a loan" to the HOA that will be due and payable upon passing of the association. Then the HOA might even need to do a special assessment.
Does anyone know - if a development has only a few lots or units sold and the majority of lots or units are still unsold, does the developer typically hold the rights to vote the unsold lots or units at Homeowners Association meetings?
Your HOA docs should say when the owners take over..usually when x% of the units are sold.
Texas POA. Land developer purchased 200 lots in existing POA. Used the lots to vote himself in as president. Has not paid dues and using association assets to develop his individual building business. Is this legal? Can he vote on his unsold undeveloped lots?
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