Over the past two years numerous Cincinnati developers defaulted on subdivisions and stranded homeowners with 1/2 finished communities. The primary cause is the slowed pace of new construction growth and the tightening of credit.
Cincinnati.com highlights a common practice that allows land developers to form LLC corporations to protect their interests so that in the case that the development fails they can still walk away without major financial loss.
Meanwhile the initial homeowners who purchased the first homes have to live in a partially finished subdivision with little prospect of seeing the remaining lots developed into homes. Vacant overgrown lots, they say, are having a negative impact on their home values making it difficult to sell their homes. One consideration when purchasing a home is how many open lots are there? This fact can have an impact on your home value for years to come if it is not built on.