Expense associated with roads not turned over to the HOA

Started by RayK6 • 6 replies • 158 views

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RayK6 (Kentucky)
Posts: 1

Posted:

I purchased a lot and had the developer build a home for me in a small subdivision in Kentucky. The builder advertises the amenities to include paved streets, but the roads are gravel and are still owned by the developer. The roads wash out every time we have a heavy rain and the developer keeps raising the HOA dues because of the cost of repairing the gravel roads. There are only a few homes in the neighborhood, so the full cost of the roads is falling on a very small group of home owners. My question is, since the developer owns the road, and advertises paved streets, are we the home owners responsible for the the cost of the constant repairs to what are in essence, temporary roads owned by the developer?

ElleN (Idaho)
Posts: 1,333

Posted:

RayK6, you say the roads are "still owned by the developer." Without seeing the governing documents, a reader here can only guess about who is supposed to bear the expense of (1) maintenance of gravel roads; and (2) installation of the paved roads.

Consider this option: Pay several thousand dollars to an attorney. Said attorney will review the governing documents and the history of payments by lot owners. If the attorney thinks the developer is violating the covenants, then the attorney will write a demand letter. And you may have an enemy for the rest of the time the developer is in control. You likely will not get back the several thousand dollars you spend on the attorney.

The alternative is to wait until turnover of the HOA to an all-owners' board.

SheliaH (Indiana)
Posts: 6,964

Posted:

And when the owners take over, all of you will still have to pay for road maintenance because they'll probably be considered common areas owned by the HOA.

I have a feeling the developer is having money issues and/or is trying to wait until more lots are bought and homes built before the gravel is replaced with concrete. Unfortunately, he might not realize crappy roads are a good way to convince people NOT to buy in.

It may be better for you and your neighbors to convince the guy or gal to go ahead and get you taken care of now, otherwise it'll cost even more for everyone down the road. If you do need to take legal action, all of can chip in on the costs and ask for reimbursement of legal expenses if the matter ends up in court and you win.

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

TimB4 (Tennessee)
Posts: 21,059

Posted:

The developer may or may not have appointed a board of Directors (typically their investors or friends)
The developer may or may not have incorporated the Association

Until the management of the development/HOA transitions to the owners, the developer is the HOA.

You may want to encourage the developer to develop/finish the drainage system to minimize wash out of the roads.

This is also the time to see if the developer was required to place a bond with the city/county (don't ask the developer, go to the court house or department responsible and check).
Find out the terms of the bond and when it is to be returned.
I say this because if something happens and the developer doesn't finish everything promised, the members of the HOA can lay a claim to the bond to pay for those things (you should consult with an attorney to do this).

DeanJ
Posts: 1,786

Posted:

Quote:

Posted By RayK6 on 07/31/2025 7:23 AM
I purchased a lot and had the developer build a home for me in a small subdivision in Kentucky. The builder advertises the amenities to include paved streets, but the roads are gravel and are still owned by the developer. The roads wash out every time we have a heavy rain and the developer keeps raising the HOA dues because of the cost of repairing the gravel roads. There are only a few homes in the neighborhood, so the full cost of the roads is falling on a very small group of home owners. My question is, since the developer owns the road, and advertises paved streets, are we the home owners responsible for the the cost of the constant repairs to what are in essence, temporary roads owned by the developer?

Something is terribly wrong with your description. When an HOA is formed with common elements (land) those elements are in the name of the HOA prior to selling lots. Normally improvements of HOA land is completed prior to or very shortly after the lots are being sold.

I suspect you are being scammed.

MarkM19 (Texas)
Posts: 1,459

Posted:

Ray,
My question is how many lots are in this development? You mentioned that the developer keeps raising your dues to cover road maintenance. From my view and I am not a lawyer, but all unsold lots are owned by the developer. That means if there are 100 lots in this development and only 10 are sold the cost of the road work should be 90% the developers responsibility and 1% yours and the other current owners. You can do the math with the real numbers that you have not provided us.

The developer owns the lots until a transfer is completed.

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