These are the answers to some of the most frequently asked questions we receive regarding developer-controlled properties. Please glance through them – it may save you time in getting answers to your question.
▶ Will the managing agent sign checks and contracts?
Yes, with written instruction from the developer.
▶ Do transfer fees apply to the lots the developer sells to the first builder?
Yes.
▶ Is deficit funding by the developer considered to be a loan to the HOA?
Although deficit funding may be done as either a loan or a contribution, it is generally recommended that it be a contribution and should be anticipated by the Developer in the development plan.
▶ If the Developer owns most of the lots and represents at least 2/3 of the total lots, can he pass a special assessment without membership approval?
Yes, assuming that the governing documents do not require a greater percentage vote to do so. However, it is strongly recommended that the reasons for special assessment be communicated in advance to all owners.
▶ Is a capital reserve study required during developer control?
No. However, it is strongly recommended once all the amenities have been completed in order to provide a solid baseline for the HOA when it assumes control.
▶ Do we have to establish and fund a capital reserve account?
Check the governing documents. Even if one is not required, it may be worth considering to avoid problems or recriminations after transfer to homeowner control.
▶ Can common area property owned by the developer obtain nominal valuation from the appraisal district?
With the exception of greenbelts, no. Common area property owned by the developer is deemed to be held by the Developer as part of a business enterprise and not as part of a Homeowners Association.
▶ Does the HOA pay the cost to mow undeveloped land not yet annexed by the Association?
No. This is the sole responsibility of the owner of the land.
▶ Can we hold annual meetings off-site and during early morning hours?
Yes. You simply need to provide proper notice of the date, time and place of the meeting to all owners.
▶ Do we have to hold annual meetings while the Declarant is in control?
Most governing documents require an annual meeting. However, while the community is under control of the Declarant, annual meetings are held in order to communicate with the homeowners. No elections are held.
▶ Do we have to have monthly Board Meetings?
Generally no. Although it is a good idea to have regular meetings to keep abreast of issues of mutual interest to the Developer and the Homeowner.
▶ None of these answered my question
If none of the above answered your question, please send it to ami@amitx.com or call our Resource Center at 713-932-1122 and we will get back with you. Thank you!