by Brian Tight, Director of Developer Relations & Lake Worth Regional Director, Campbell Property Management
During your HOA turnover, also known as the developer turnover process, your homeowners’ association can expect for many events to take place. The turnover process is a momentous occasion, if not the most important in a community’s history. During this process, homeowners are given control of their community.
At the time of the turnover, your HOA will obtain all of the items that are listed in the contract from the developer. In Florida, the law requires that the developer handover control of the homeowners’ association to the homeowners three months after 90% of the homes have been transferred to their buyers. At this point, homeowners are entitled to elect the majority of the board. The developer is still entitled to appoint at least one board member provided that it holds for sale at least 5% of the homes. Depending on the time restrictions and how many units have been conveyed to their purchasers, homeowner associations will be able to begin electing their board members.
Besides the standard turnover process, other events that can initiate the process include bankruptcy, receivership of the developer, and the appointment of a state court receiver. Once the homeowners are given legal control from the developer, they must accept the responsibility to manage the community themselves.
Your homeowners’ association should proceed through the turnover process properly, meticulously, and vigilantly. It is important to obtain as much information from the developer as possible during the turnover. Ask your property management company for assistance, as they should have prior experience with this turnover process. Read Florida Statute 720.307 – Transition of association control in a community (with respect to homeowners’ associations), for more information.
Has your community recently experienced developer turnover? Let us know in the comment section below.