Developer controlled HOAs
Buying into a developer-controlled HOA
South Carolina sets no turnover deadline
By Timmy Fredrick Nash, Broker-in-Charge, 30+ years on the Grand Strand · Reviewed by Devin Day, Operations Officer · Updated August 29, 2026
Turnover is when the developer hands the HOA to an owner-elected board. South Carolina law sets no deadline and no percentage sold. The recorded documents decide, and the developer wrote them. Read them before you sign.
If you have any questions while reading, call 854.333.2135.
THE DIRECT ANSWER
No law sets a turnover date
Turnover is the handover. The developer stops running the HOA and the owners elect their own board. South Carolina has no law that says when that must happen. No deadline. No percentage of homes sold. No duty to hand over at all.
So the recorded documents decide. The declaration and the bylaws set the trigger, and the developer wrote both before a single owner existed. Those documents call the developer the declarant, so that is the word to search for. Look for what ends developer control. If nothing ends it, that is your answer.
The developer can also write advantages in for itself. Its votes can count for more than yours. It can appoint some board seats instead of letting owners elect them. One rule protects you. Governing documents have to be recorded at the county land records office to be enforceable, so they are public and you need nobody's permission to read them. Our page on South Carolina HOA laws covers the rest.
THE MONEY
The dues quote may be an estimate
Before turnover, the dues figure you are quoted can be a forecast instead of a full year of real bills. A forecast written by the party selling you the home is not the same as twelve months of paid invoices. You are not an owner yet, so you cannot request association records. The seller can. Have the seller provide the budget and the dues history before you make an offer.
Ask for the reserves the same way. Reserves are the savings account the community keeps for big repairs. If the account is short and a roof or an elevator fails, the money gets raised from owners instead. That is a special assessment, and it can run into thousands per home. Our pages on what HOA fees cover and reserves and reserve studies show you how to read the numbers.
There is usually something to pay at closing too. A few months of dues up front is common, plus a document fee and an account setup fee. Amounts vary by community, so ask early. Tell us which community you are looking at and we will get the budget, the reserve study and the dues history from the seller before you make an offer.
- ✓Budget or projection. Have the seller provide the current budget, then check whether the dues figure comes from real bills or from an estimate.
- ✓Reserve study and balance. Ask the seller for the study, when it was done, and what sits in the account today.
- ✓Unsold lots. Read what the developer pays on the homes it still owns, and whether it pays the full amount.
- ✓Who can raise dues. Read the assessment section for a cap, a limit on yearly rises, and who votes.
- ✓Notice before a raise. Ask how much warning owners get before a dues increase is voted. State law can allow as little as 48 hours.
THE LOAN
Developer control slows the loan down
While the developer still runs the HOA, most lenders treat the community as new, even if it looks finished and nearly sold out. A new community gets a longer, deeper review of the association itself. The lender reads the budget, the reserves, the insurance and any lawsuits.
That review has a shelf life. On a community the developer still controls it expires sooner, and on a slow build it can run out and have to be done a second time before you close. So start it early. If a community cannot pass, there are lenders who work outside those rules. Our page on non-warrantable condos explains that route.
You will also read that a set percentage of homes has to be sold before turnover. That is not a state rule. Those percentages come from mortgage rules about where a lender will lend. They are conditions on a loan, not duties on a developer. Devin Day, our Operations Officer and a licensed mortgage loan originator, NMLS 2721275, will tell you what a lender needs on a specific community before you write an offer.
AFTER THE HANDOVER
Turnover is when owners get to decide
A Grand Strand community moved from builder control to an owner-elected board. The obvious ideas came first. A pool. A dog park. A barbecue area. Then the new board read the numbers.
The money went somewhere else. It was spent on preventing storm damage, chosen in close work with the insurers. The next renewal came in under a 5 percent rise while comparable communities nearby saw far larger ones, and owners were told exactly why. The board also renegotiated the lawn care contract to help absorb the insurance cost.
Turnover is where dues can jump. It is also the point where owners finally get to hold them down. Which one you get depends on whether the new board reads the numbers before it spends.
BEFORE YOU SIGN
Get the documents before you sign
The right to demand records from an HOA belongs to members, and a buyer under contract is not a member yet. Nothing hands you the budget or the rules before closing. The seller disclosure will not fill the gap either. A seller has to say whether there is an HOA, and is also allowed to answer that they make no representations. Most people who complain about their HOA never saw the documents before they bought.
Two things work. Pull the recorded documents at the county office yourself. Put a deadline in your contract for the association package, with the right to walk if what you read is not what you were told. Associations usually take about three days to send one. Our page on which HOA documents to request lists each document and what it shows.
Send us the address and we will pull what is recorded, run the package through our document tool, and have a person read the output with you. Our page on buying new construction on the Grand Strand covers the rest of the process. Chapter3 Realty Corp is a South Carolina real estate brokerage. Our Broker-in-Charge, Timmy Fredrick Nash, holds South Carolina real estate license 43182. We are not attorneys and this is not legal advice. Ask a South Carolina attorney about your rights.
- ✓The declaration, plus every recorded amendment. Amendments are where developer rights get extended.
- ✓The bylaws. This is where you find who runs the place and how board seats get filled.
- ✓The current budget and the latest reserve study. Have the seller ask the association whether the budget is actual or projected.
- ✓The dues history. Every increase since the first closing in the community.
- ✓Any turnover terms by name. Search the documents for declarant control and Class B membership.
Sources. South Carolina HOA Act (2026); South Carolina condo law (2026); South Carolina nonprofit corporation law (2026); South Carolina seller disclosure law (2026); South Carolina HOA complaint report (2026). Verified July 2026. This is general information about how associations work, not legal or tax advice.
Buying where the builder still runs the HOA?
South Carolina sets no turnover rule. The recorded papers do. We read them first.
Common questions
Developer Control FAQ
When does a developer have to turn over an HOA in South Carolina?
There is no deadline in state law. No date, no percentage sold, no duty to hand over at all. The recorded declaration and bylaws decide it. Read the declaration and every amendment, and look for what ends developer control. If nothing ends it, that is an answer too.
What percentage of homes has to be sold before HOA turnover in SC?
None. South Carolina sets no percentage that triggers turnover. The percentages buyers read about come from mortgage rules, which decide where a lender will lend. They are conditions on a loan, not duties on a developer. Only the recorded documents set the trigger in your community.
Can I get a mortgage on a condo when the developer still controls the HOA?
Usually yes, but expect a longer review. While the developer runs the association, most lenders treat the community as new and review the association in full. That review can expire on a slow build and have to be run again. Ask your lender to start it early.
Will HOA dues go up after the developer turns over the community?
They can go either way, so ask two questions. Is the dues figure built from a full year of real bills or from an estimate, and has a reserve study been done. A short reserve account is the usual reason a special assessment shows up later.
How do I get the HOA documents before I buy in a new community?
Use the county recording office and your contract. Governing documents have to be recorded to be enforceable, so they are public and anyone can read them. The right to demand records from the association belongs to members, and you are not one yet. Put a document deadline in the contract.