Why association fees go up after the developer turns over your community
During construction, many developers quietly cover part of a community’s costs to keep fees low while homes sell. When they step away, the costs stay. Here’s what changed, who decides your budget, and how to stay informed.
Your fee didn’t get more expensive. It finally shows the full cost.
In one paragraph
While a community is being built and sold, the developer controls the association and its budget. To keep monthly fees attractive to buyers, many developers cover part of the community’s costs themselves. At turnover, that support ends, but the landscaping, snow removal, insurance, utilities, repairs and reserves still have to be paid. The new budget has to cover those real costs from owner assessments alone, which can sometimes double or even triple the fee.
- This is common in new communities. Industry writers describe it as “assessment shock,” and note that developers often absorb expenses so assessments look low and homes are easier to market.
- Costs didn’t appear overnight. They were always there; the developer was paying part of them.
- The board adopts the budget. During development, that board was appointed by the developer.
- The increase isn’t a management fee. It pays your community’s own bills and savings.
- Reserves protect you later. Funding them now helps avoid large special assessments down the road.
The whole story in about two minutes.
Jump to any part with the chapter buttons.
Three stages, one community budget.
The cost to run your community stays roughly the same from one stage to the next. What changes is who pays for it.
During development
The developer controls the board and the budget. To help homes sell, it may pay some bills directly, maintain common areas with its own crews, or cover budget shortfalls. Owners pay a fee that covers only part of the real cost.
At turnover
Homeowners elect their own board and the developer steps away. Its financial support ends, but the community’s bills keep coming: landscaping, snow removal, insurance, utilities, repairs and more.
The new budget
The budget is rebuilt around what the community actually costs to run, plus reserves for future repairs. Owner assessments now carry 100% of the cost, so the fee resets, sometimes to two or three times what it was.
See how a developer subsidy hides the real cost.
Enter a fee and move the slider to see what the same expenses would cost owners once the developer’s share goes away.
If the developer covered 50% of the real cost, a $100 monthly fee would need to be about $200 monthly to pay the same bills.
Illustration only. It doesn’t include reserve contributions, inflation, new contracts or insurance changes, and it isn’t your community’s budget. Your board’s adopted budget sets your actual assessment.
Common assumptions, answered honestly.
Tap a card to see the answer.
The board sets the budget. Management carries it out.
It’s natural to direct questions to the company that sends the statements. Knowing who does what helps you take your questions to the right place.
Your board of directors
Makes the decisions
During development, the developer’s appointees served as the board. After turnover, homeowners elect it.
- Adopts the annual budget
- Sets the assessment amount
- Makes the rules and policies
- Approves the association’s contracts and spending priorities
Blackstone Management
Carries out the board’s direction
We work for your association, at the board’s direction.
- Gives the board accurate, real-cost numbers
- Pays the community’s bills from the association’s own accounts
- Helps plan responsible reserves
- Keeps your association financially healthy for the long term
Our position: Blackstone strongly recommends that developers fund associations at their true cost from the very start. Some don’t, because lower fees make homes easier to sell. Our goal is the same as yours: a community that is well maintained and financially healthy, without surprise special assessments.
What Maryland law says about turnover and reserves.
State law sets the timing of turnover and requires covered associations to study and fund reserves. Here are the basics in plain language.
When HOA turnover happens
A homeowners association must hold a meeting to elect its governing body within 60 days after at least 75% of the lots that will be part of the development are sold to the public, or a lower percentage if the governing documents say so.
When condominium turnover happens
A condominium’s transition meeting must be held within 60 days after units representing 50% of the votes have been conveyed by the developer to the public.
A reserve study before turnover
For newer communities, the developer-controlled board must obtain an independent reserve study before the transition meeting, and the replacement reserves handed over must equal at least the amount that study recommends.
Reserves in every budget
Since 2022, Maryland’s reserve-study law applies statewide. Covered associations must update their reserve study every five years and budget for reserves at the recommended level.
This is general information, not legal advice. Your association’s governing documents and legal counsel are the authority for your community. Rules in other states differ.
Helpful tips for homeowners, buyers and new board members.
Attend your next board meeting
It’s the best place to ask questions. Maryland HOA meetings are generally open to members, and the board must hold at least one meeting each year with an agenda open to any association matter.
Log in to your owner portal
Find your next board meeting’s date, time and details in the online owner portal, along with your account information.
Read the budget before the meeting
Look for the line items the developer used to cover, such as landscaping, snow removal or utilities. Write your questions down so you can ask them in the owner comment period.
Ask about the reserve study
The reserve study shows which major components your community owns, when they’re expected to need repair or replacement and what that will cost.
Plan ahead for the new amount
Update your household budget once the new assessment is adopted. If you expect trouble paying, reach out early rather than falling behind.
Get involved
Consider running for the board or volunteering for a committee. A homeowner-led board is how owners shape the community’s priorities.
Ask for the current budget
Compare the assessment with the community’s real operating costs. A fee that seems unusually low for the amenities may be subsidized.
Ask whether the developer covers costs
Ask which expenses the developer is paying directly or funding, and what happens to them at turnover.
Ask for the reserve study
It shows whether the community is setting aside enough for future major repairs, which affects future fees.
Ask how close turnover is
If most homes are already sold, a budget reset may be coming soon. Factor a possible increase into your purchase decision.
Read the governing documents
The declaration and bylaws explain how assessments are set, what the association maintains and when owners take control.
Budget for the full cost
Plan your finances around what the community really costs to run, not just the introductory fee.
Rebuild the budget from real costs
Don’t carry over the developer-era budget. Start from actual contracts, utility bills, insurance and maintenance needs.
Identify every subsidy that’s ending
List each cost the developer was covering so nothing falls through the cracks after turnover.
Review the reserve study
Confirm the reserves handed over and plan contributions at the level the study recommends.
Explain the change to owners
Share this page and the video before the budget meeting so owners understand why the fee is changing.
Keep meetings open and clear
Give owners time to comment, and keep minutes that explain the budget decisions.
Lean on your management team
Ask your Blackstone manager for clear financial reports and real-cost numbers to support the board’s decisions.
Your before-the-meeting checklist
0 of 6 doneFrequently asked questions.
Why did our association fees go up after turnover?
While homes were being sold, the developer controlled the association and often paid part of the community’s costs to keep fees low. At turnover, that support ended. The budget now has to cover the full cost of running the community, plus reserves, from owner assessments alone.
Did Blackstone Management raise our fees?
No. Your board of directors adopts the budget and sets the assessment. During development, that board was appointed by the developer. Blackstone carries out the board’s direction, provides accurate financial information and pays the association’s bills. The increase isn’t a management fee; it pays your community’s own expenses.
Why would a developer keep fees low?
Lower fees make homes easier to sell. It’s a common practice in new communities. Blackstone strongly recommends that developers fund associations at their true cost from the start, so owners aren’t surprised later.
Is it normal for fees to double or triple?
It can happen when the developer was covering a large share of the costs. The size of the change depends on how much support the developer provided, your community’s amenities and contracts, and its reserve needs.
Why can’t we just keep the old fee?
The old fee didn’t cover the full cost. Keeping it would mean cutting services, putting off maintenance or draining savings, which usually leads to larger special assessments later. In Maryland, covered associations must also budget for reserves at the level their reserve study recommends.
What is a reserve fund and a reserve study?
A reserve fund is the association’s savings for major repairs and replacements, such as roofs, roads and other common components. A reserve study is a professional analysis that lists those components, estimates their remaining useful life and cost, and recommends how much to set aside each year.
What’s the difference between a regular assessment and a special assessment?
A regular assessment is your ongoing monthly, quarterly or annual fee that funds the yearly budget. A special assessment is a separate, one-time charge to cover a cost the budget and reserves can’t, often a major repair. Healthy reserves make special assessments less likely.
Will our fees keep rising like this every year?
The turnover reset is usually the biggest single adjustment, because it brings the fee up to the real cost all at once. After that, budgets still change from year to year as contracts, insurance, utility rates and reserve study recommendations change.
Where can I find the budget and our next board meeting?
Log in to the online owner portal to find your next board meeting’s date, time and details. The board meeting is the best place to ask questions about the budget.
Can homeowners give input on the budget?
Yes. Attend your board meetings, use the owner comment period and consider joining a committee or running for the board. In Maryland, HOA meetings are generally open to members.
Know a neighbor with questions?
Send them this page or the one-page flyer so everyone starts from the same facts.
Attend your next board meeting.
Your board meeting is the right place to ask about your community’s budget. Log in to your online owner portal to find the date, time and details.
Board member or developer planning a turnover?
A smooth transition starts with a budget built on real costs and reserves funded from day one. Talk with Blackstone Management about managing your community association. Call (240) 349-2117.
