The advice your getting sounds solid. Here's another perspective. We actually live in Stonewater, don't work for Legend, aren't selling our place. In other words, we have nothing to gain from telling you this.

The attorneys estimated our personal payout after arbitration under $5K, but of course no one knows for sure at this point. I don't think the arbitration will go on for years but then after that's done, the work needs to be done. Legend figured out there was a problem while they were building and apparently not all units are affected (but it's an HOA so everyone shares the burden of the cost regardless).

What I can tell you is this is a fantastic neighborhood to live in in terms of the lifestyle and neighbors and we've been very happy living here.

Please remember some day you will need to sell the property you are wanting to buy. If it has that much problems it may be years before all is settled and repaired, these folks that already own before the problems came up, nothing they can do about it, but ride it out. But you as a buyer, and in this market, go else where as fast as you can. Keep the buying of a home a business reasons, and remember resell!!!!

H. Rawie

Radaile,

While I am a broker with Remax, I also serve on the Board of Directors at Orenco Station. We have gone through these issues with our builders, having had our entire community virtually rebuilt. While you might want to discuss the matter with a lawyer, I can give you a perspective as someone who has been through the construction defect and remediation process in detail.

Under the Construction Defects statute, the builder has to remediate any construction defects within ten years of the time of occupancy. If the builder refuses, or if the builder and homeowners can't come to an agreement, the HOA often sues. These suits very seldom go to trial. Nearly all are settled in arbitration.

Remediation amounts can run into the millions of dollars. While I do not know the facts of the case at Stonewater, my guess is that repairs will be very expensive. Most builders cannot pay these huge sums, bankrupt or not, and turn the claim for repairs over to their insurance companies. The insurance companies are the ones who usually go to court and end up in arbitration.

If the HOA loses, the individual owners will be assessed to pay for the repairs. What usually happens is that the HOAs settle for less than it costs to do the repairs, and the owners make up the difference.

Here's an example. Say an HOA has 50 homes and sues a builder for construction defects in the amount of $1 million. The case goes to court, winds up in arbitration and the HOA is really lucky and is awarded the entire amount. The attorneys' fees are $250,000 (a 25% contingency fee is not uncommon). That leaves the owners $750,000 to make the repairs. Unfortunately, they still need an additional $250,000, so they assess each of the 50 homes $5,000.

The $5,000 is a lien. If the owner sells, it will be paid from the proceeds. If the owner sells before the case goes to court, then the new owner will have to pay.

I can't encourage you enough to tread very lightly, here, and be to be very careful. There are ways you can protect yourself, and you may need an attorney. Please call me at 503-913-0098 if you'd like to discuss it further, or e-mail me at bmetzker@remax.net.

Construction defects in homes built in the last 10 or 12 years is Portland Metro's great unrecognized toxic asset. It's sad.

Hello there,
I would caution you to speak with a real estate attorney. This situation could go many directions and I would hate to mislead you based on prior experiences.

There are many homes available on the market today so you might consider looking at one of them if you are not comfortable with this home.

Hank Paterson
503-803-7204