Due Diligence

Did you do your due diligence before you bought your home in Hampton Lakes or River Hall? Here’s how I thought I did my due diligence. My wife and I flew here in November 2020 for two weeks to find a house. I had a list of about 5 or 6 neighborhoods to check out. Hampton Lakes was towards the end. After looking at the models and liking the Summerwood my wife and I drove around the neighborhood to get an idea of the people living here. Everything was beautiful. It was quiet and all the homes were nicely landscaped and all the cars parked in the driveways looked pretty good, no beaters. We then went to the Amenity Center to look at that and the pool. I gave big points to the resort style pool.

We then went to Portico to check out that neighborhood and it was nice, but I didn’t really like any of the floor plans or how they did the options. The sales person there pointed out that the pool in Hampton Lakes was not heated, theirs was. I didn’t think anything of that at the time. Its Florida! Who needs a heated pool?! We then went to Babcock Ranch. Same builders Lennar and Pulte. But the homes there had asphalt shingle roofs (not tile) and the driveways were concrete (not pavers). And the homes were more expensive. So I thought in Hampton Lakes you get more and they actually cost less. So Hampton Lakes and that resort style pool were it!

We went back and put some money down on a lot to get the ball rolling. We flew back to Arizona to start getting that house ready to sell. I emailed our Pulte salesman to get a copy of the HOA CC&R’s. All he kept sending me was the articles of incorporation. I wanted to see the rules and regulations before we put the big chunk of change down that would have locked us in to the house. I didn’t get them in time and I thought how bad could they be, so we put the big chunk of change down and got locked into the house. It wasn’t until after we closed in August of 2021 that I finally got to see the CC&R’s and more importantly the Bylaws of the HOAs. This was because after you close, you get access to the website where these documents are stored.

So it took me a while to read the documents and what I found was quite unexpected. The CC&Rs were pretty typical, with no really strange rules. But the Bylaws were interesting. This development started back in 2005. It apparently went bankrupt in 2008 during the housing crisis. The current developer took over some time after that. Apparently its been slow going selling houses until recently with this crazy housing market we’re in right now. The HOAs were not going to be turned over to the homeowners until the community was 90% complete, OR at the end of 20 years! Guess what? That means we’re going to get control of the HOAs in 2025. What’s the problem with that?

The developer owns everything, not the HOAs. So WE ARE GOING TO HAVE TO BUY the Amenity Center, the pool, the tennis courts, pickle ball courts, the open fields and the common areas. A final coat of asphalt is going to go on the streets that we’re going to have to pay the upkeep on even though there’s construction traffic going on until who knows when if the developer gets to add another 500 plus homes to the development. Plus, everything will be 20 years old, so the maintenance on that might be high. I know a lot of people were upset about heating the pool. How are they going to feel now that they have to buy the pool for a much larger price!?

I was recently put on the Amenity Center HOA Board. I tried to get questions like what are the price tags on everything on the meeting agenda so I could get them answered, but was shut down even though I was promised they’d be answered at the meeting. I talked to the developer’s construction manager and he told me that I didn’t due my due diligence. I later thought “how could I do my due diligence if I didn’t have access to the documents until after I closed”.

So how do we get these questions answered if I can’t get them put on the agenda because apparently you can only talk about what’s on the agenda at the board meeting? The answer is, have a members’ meeting. To do this, 25% of the River Hall and 25% of the Hampton Lakes residents have to petition for a members meeting to be held. Then members can ask anything they want. Wouldn’t it be nice to know how much money we have to come up with to buy everything? And wouldn’t it be nice to know sooner than later? If we found out soon, maybe we can start accumulating the monies needed to buy everything over the next 3 years with a minor increase in fees as opposed to one big special assessment that some people might find to be too much.

I went through a little training on being a HOA board member and the first thing they mention in the class is the fiduciary responsibility of the board. When you’re handling a large sum of other people’s money, you have to be responsible and forthcoming. Has any homeowner, or prospective homeowner, been told by anybody in the builder’s group or developer’s group that in 2025 you’re going to have to come up with a lot of money to buy everything and that your ongoing fees may also go up quite a bit? I don’t think so. It might hurt sales!

Here’s another little tidbit. A full time maintenance man has been hired to work at the Amenity Center. The annual budget for this department is $75,000. So they are taking $75,000 of our money every year to maintain the developer owned amenity center which we will then have to buy in 2025! Sweet deal! When are we going to have that Member’s Meeting?!