Declarant controls the board & breaks their own covenants

We are a Virginia HOA with <200 homes built in a 15-20 year project of 3,500-4,000 homes. Our board is controlled by the declarant/developer and they are breaking their own covenants. We just established committees and Landscaping submitted their minutes and suggestions. The response from the declarant/developer is "We do not have any funding available until 2014". Most of us bought at the top of the market, so finding residents who want to pool their money to seek legals advice/recourse will be hard to find. Any suggestions above and beyond legal recourse? Our front entrance and roadway into the complex is quite the mess (dead trees, balding & eroding soil, varied grass types). Our street signs & entrance sign need to be repaired and painted.

Allyn

If you bought at the peak (when ?) and now in 2013 only 200 of the proposed 3,500 homes have been built, the place has to be in deep financial (and I might expect legal) trouble. Unless the developer is a major company with deep pockets, I expect they may well not have two pennies to rub together.

You could set up public protests. No developer wants to see that. Threaten first and see where it gets you. Get them signs up and people marching.

The existing owners pony up and make some repairs.

Sell if you can assume the loss and get out.

Sorry I could not be more encouraging.

Thanks to all for your responses. We get mixed signals from the Declarant, he always cries the blues, as he continues to open new cup-de-sacs. He has put the homes on postage stamp property sizes and has cheapened the final product hurting those of us who were first in as it downgrades the neighborhood. We realize that the price points changed, due to the great recession but I am not fully trusting his financial condition. We as residents have to abide by the covenants whether we can afford it or not, why does he get an easy pass? The HOA Act in our State of VA is so pro declarant, they never mention the resident. It is appalling. To do the repairs in question is chump change for a group that can buy such large tracts of land and wait 15 years to finish.

Allyn,

One of the lessons I have learned from this forum is that buying into a new development in its early stages is risky. Despite everyone's high hopes, things can go wrong very quickly and once they start going wrong they are likely to continue sliding downhill.

Sound advice especially early on in a development like the 25th out of 2,500 homes.

I bought in my present HOA when it was about 70% complete (mid 2011, 75 of 113 sold) and the homes were selling. Also there had been a financial report/budget presented every year. One could see what was happening and I was comfortable especially knowing I would not be selling for many years.

Here it is early 2013 and our transition will take place in early 2014. Our major risk is that the Declarant could play games with our reserve but our Declarant has been a very above board, open, honest guy so I am not concerned.

One very stable, well run, 25 year old ownhouse HOA I lived in required a $25K one time assessment (average townhouse value of $400K). It was aging, work needed to be done, and the siding that was used was no longer manufactured so major changes had to be made. Issues were recognized and 80% of the 175 owners agreed and voted for such. You could have moved in and one year later, a $25K assessment so nothing is guaranteed.