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Financial Pitfalls Following Developer Transition
By Maria C. Kao & Matt Meadors Note: This article first appeared in the Summer 2024 Edition of The Communicator Magazine.
EVERY DEVELOPMENT GOES through a transition where the original developers hand over the management and operations to the homeowners. Such a transition will include the finances of the association. Here, we focus on an association’s legal obligations, but also offer real-life advice from a professional manager experienced in turning over a community.
The finances should not be overlooked during the transition phase, and it is of utmost importance to make sure the basics are set up correctly. They should include assessment calculations, reserve studies, a thorough investigation into the operating budget and many, more discreet issues. Let’s synthesize the legal obligation information together with operational know-how for those interested in setting up the future of financial stability for a transitioning project.
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