Laurelmor Property Report

Federal law stipulates that all purchasers of land in Laurelmor, HUD Subdivision Id:31640, receive a Property Report. The Interstate Land Sales Full Disclosure Act requires that Property Reports reveal all material facts about the risks of buying land in specified Subdivisions. A review of the Laurelmor Property Report shows that the developer does not disclose landslide hazards.

The following land description was extracted from Sections of the April 25, 2008 Laurelmor Property Report provided by the developer, Ginn-La Laurel Creek Ltd.,LLLP, also doing business as the Ginn Company:

SUBDIVISION CHARACTERISTICS AND CLIMATE

General Topography

The average elevation of the residential lot areas is between elevations 1,300’ to 4,000’.... Soils within the project site are moderately erodible and should not have any significant erosion problems.

There are no physical characteristics pertaining to the Subdivision which would prohibit construction on the lot.

There are steep slopes, rock outcroppings or expansive soils conditions which will necessitate the use of special construction techniques to build on or use any lot
in the Subdivision.

Nuisances

There are no known nuisances that may adversely affect the Subdivision, however, noise from club amenities, including without limitation, golf cart traffic, lawn mowing, and other maintenance, may affect your enjoyment of the lot....Golf and tennis balls from golf courses and tennis courts may fly over or enter the lot and could strike you, a member of your family or a guest or any other person or thing on the lot.

Hazards

The Subdivision is located in close proximity to the Club which includes golf facilities. Use of the Club and the golf courses therein may cause certain noise or physical hazards to you and possibly your lot. Pursuant to the CC&R's, you must accept these potential nuisances and any risks associated therewith if you purchase your lot.

Ginn agents should have known when they performed due diligence prior to the company's land purchase in April 2005 that the 6,000 acre mountain tract was located in a state declared high hazard landslide region. The subsequent development and sale of lots in this Subdivision has exposed present and future purchasers to significant financial risk. The definition of significant financial risk can be defined as high probability of uninsurable landslide property damage.

Facts

The North Carolina Department of Emergency Management reported in 1998 that Watauga County, location of Laurelmor, was at high risk for landslide events. A 2002 state memorandum noted that the soils within the development site were highly erodible. In September 2004 Watauga County experienced significant landslide damage and was declared a federal disaster area. North Carolina geologists warned in October 2006 that preliminary studies showed extreme possibility for slope failures throughout the county. Hazard maps show that 41% of the land in the county is located in the path of potential landslides and 20% of the mountain slopes are highly unstable.

Is the failure to disclose landslide hazards as outlined by the North Carolina Department of Emergency Management and the North Carolina Geological Survey a violation of the Interstate Land Sales Full Disclosure Act? For an answer to this question, please contact the U. S. Department of Housing and Urban Development