ASSOCIATIONS Page 63 to physical defects . More often than not , neither the developer nor the owner has an accurate , or even similar , perception of the respective roles of the developer and the association .
EXPECTATIONS AND REALITIES
Buying into an estate is a big financial commitment , and the purchaser enters into the agreement with a number of expectations . If the reality does not match the created expectation there will be unhappiness , and all the relationships around the purchase are bound to be confrontational . So it is very important to carefully manage what expectations are created , and how those expectations are to be fulfilled . That involves a number of different players – the developers , the planners , the architects , the builders , the sales team , the marketing team , the purchasers themselves and , ultimately , the residential community , board or HOA .
CHANGING RELATIONSHIPS
The relationship between the parties involved is formulated well before the first owner moves in . It starts off during the design phase for both the physical structures and the governing documents , develops through the construction phase into the sales period , and then continues to evolve as the owners begin to take control of the association and shape the reality of their purchase . If not well planned and properly managed , these transitions can become adversarial .
Different relationships are appropriate for different phases of the life cycle of a development . For example , during the construction phase , the board focuses on the quality of the workmanship , and adherence to plans and specifications can minimise the potential for construction defects to become an issue .
While the sales phase overlaps all the other phases from before construction to after the first residents have moved in , selling also has its specific challenges , such as ensuring honest representation in marketing material , and attention to detail when drawing up contracts of sale , finance , etc .
Once most of the units have been sold , the developers should start handing over responsibility for the administration of the community association and the maintenance of the common property .
Preferably , this should be a gradual process that allows the owner board members the opportunity to receive proper training and to gain experience . Also , a progressive transfer of control helps protect the developer from malicious and financially harmful actions by the owner members of the board while the developer still has a substantial economic interest in the project .
Commonly , the guidelines require the election of a minimum number of owner board members at various stages of sales , beginning at 25 % and continuing to 75 %.
At this point , the owners usually elect the entire board with the exception of one developer representative who can remain until the completion of sales for the project .
PLANNING FOR TRANSITION
The ultimate goal of transition is for the homeowners to take over and move forward with a good reputation , no litigation , healthy finances and an optimistic view of the future . There is no one-size-fits-all “ right ” way of transitioning , but there is a wealth of experience from which to learn . The Association of Residential Communities ( ARC ) has produced a set of guidelines that builders and associations can use to develop and turn over a community association project in such a way that transition becomes much easier and less confrontational .