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DennisK (Michigan)
Posts: 4
Posted:
The subdivision I am in is in the beginning stages of creating a HOA. My concern is the fact that many lots are either A) undeveloped or B) developed but not sold. According to the master plan there are to be 58 homes in the development. Right now there are over 20 homes built with about 10 homes occupied with residents.

I have a feeling that the developer wants to skirt the responsibility of the subdivision, although he owns 20+ undeveloped lots.

Is there a certain percentage of homes that needs to be occupied to make a HOA binding (and effective for that matter)

I worry that the 10 homes will be forced to bear the brunt of an entire subdivision costs just because 2 or 3 of the homes haven't like the way the developer has handled the slow sales pace of the development.

DJ1 (Ontario)
Posts: 798
Posted:
Read the CCR's (Covenants,conditions and Restriction) for the answer. It probably has clauses about:

2 classes of members (ie Developer class A = 3 votes per lot owned, homeowners class b = 1 vote per lot), class A shares will be converted to class B when 75% of lots are sold, when turnover will occur ie. when 75% of the lots are sold, Rate of Assessment ie. dues of 'never occupied lots' will be 25% of the once occupied lots, etc etc.

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