HOA homes lose value when developers, builders don’t follow through

One builder dumps unfinished roads on HOA, another home builder files bankruptcy

By Deborah Goonan, Independent American Communities

In Madison County, Mississippi, home construction in the Chestnut Hill subdivision, which began in 2007, is only halfway completed. According to recent reports in the Northside Sun, only 50 of 100 planned homes have been built, and the roads in finished phases are in terrible shape.

Developer David Landrum turned over unfinished roads to the HOA, according to records, even before selling the first home, and now homeowners are stuck with lousy roads that require hundreds of thousands of dollars to repair.

 

HOMEOWNERS APPROACH BOARD FOR HELP IN SOLVING CHESTNUT HILL ROAD ISSUES

WED, 04/05/2017 – 4:26PM BY MEGAN PHILLIPS

Bad and unfinished roads brought Chestnut Hill subdivision representatives to the Madison County Board of Supervisors meeting seeking help.

The 100-home subdivision off Highway 463 could be facing costly road problems. This issue comes after months and even years of issues between developer principal David Landrum and lot owners in the subdivision.

“The biggest issue (right now) is the roads aren’t being maintained, so we don’t want more roads being built,” Homeowners Association (HOA) representative Russell Green said.
According to Green, Landrum placed the roads under the responsibility of the HOA before anyone bought lots. He was the only member of the association and accepted the responsibility as HOA president.

– See more at:

http://northsidesun.com/news/homeowners-approach-board-help-solving-chestnut-hill-road-issues#sthash.CNSFtoUM.ksyTNkQK.dpuf

 

And an earlier news report reveals that Landrum also changed restrictive covenants to allow for much smaller homes than was originally planned. Now homeowners are concerned that their property values will drop because of smaller neighboring homes.

 

Chestnut Hill home battle continues

By MICHAEL SIMMONS, Madison County Journal
Wednesday, November 30, 2016 6:00 PM

CHESTNUT HILLS — Homeowners battling with the developer of a subdivision here will have to wait another week before some type of resolution is made by the Madison County Board of Supervisors in an ongoing dispute over the minimum square footage of homes on nine undeveloped lots.

Lawyers representing the county, the developer and nearby homeowners argued for nearly an hour last week over whether or not the board should approve a preliminary plat for Chestnut Hills Part 1E, Phase II, which has already been approved by the county twice.

At question is the lowering of minimum square footage from 3,500 square feet to 2,500 square feet for nine lots. Homeowners have said the covenants, which stated 3,500 square foot minimums, were amended at the eleventh hour without approval from the HOA.
– See more at:

http://www.madisoncountyjournal.com/Content/Default/News/Article/Chestnut-Hill-home-battle-continues/-3/592/38945#sthash.lvommEnV.dpuf

 

So here you have two examples of exactly what can – and often does – go wrong when Developers are given absolute control over the communities they build. Home buyers and owners are basically at the mercy of a developer that creates and controls the HOA.

This explains why, all too often, homeowner and condo associations end up with unfinished roads, bad drainage, poor workmanship in general, and huge amounts of the builder’s unpaid debts. It seems as though no one at the municipal or County level is keeping a watchful eye over developers – until homeowners start to complain that they have paid a great deal of money for a whole lot of headaches.

Who ever thought it was a good idea to put developers in charge of governing common-interest communities? Why does state law allow a developer to dump his liabilities onto unsuspecting homeowners?

Whatever happened to common sense?

The person who sold you your house, the one who built your home and surrounding community, can change all the rules of the game, and, as a lowly homeowner, you cannot do much about it, unless you want to challenge by filing a lawsuit. If the Developer is well-financed, prepare for a costly legal battle.

But what happens if you decide to sue, and the developer declares bankruptcy? Well, the developer may simply avoid paying most of his financial obligations, and leave you with an unfinished home, as is the case for these homeowners in Texas.

Many families out of homes, large sums of money after builder files for bankruptcy

Numerous people have filed suit against Bella Vita Custom Homes stating they didn’t complete the work even after money was paid

AUSTIN (KXAN) — As the housing market continues to flourish in Central Texas, the number of families willing to spend hundreds of thousands of dollars to custom-build their dream home is rising.

Joel and Tracey Lackovich had been saving for years to build their dream home for their growing family of six. “We’ve been saving up for this,” the Lackovichs’ said. “We were putting everything—our hard-earned money and savings—into this. This was a very calculated move for us financially.”

What was supposed to become their dream quickly became the couple’s personal nightmare of an experience when they signed a contract with Bella Vita Custom Homes, LLC to build their home in the private, gated community of Spanish Oaks in Lakeway. As KXAN started looking into the couple’s story, it became apparent that their experience wasn’t an isolated incident.

Read more (Video):

http://kxan.com/investigative-story/shattered-dream-homes/

 

More evidence that real estate developers have too much power, and not enough accountability.


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