Florida has significant problems– rising real estate-related insurance, inspection, over-building, and property ownership-related costs–that are being ignored as Florida Governor Ron Desantis runs for president.
To millions of Floridians, the new financial problems are severe enough that many will not be able to pay their monthly mortgages and related Home Owner Association (HOA) fees and special assessments.
To many homeowners and condo and homeowners, Florida is no paradise.
Despite a common belief, Florida is not an inexpensive place to live. A recent survey by CNBC found that no Florida city ranked in the top 10 of the least expensive cities to live in the U.S. Naples ranked as the eighth most expensive city in the survey to live, with a median house price of $806,604.
Bad weather is another danger. The state is one hurricane away from a financial disaster. The reality is that unchecked homeowner insurance rate increases, combined with new financial requirements for older condominiums over three stories tall, the monthly non-mortgage rate increases are making homeownership problematic for millions of Floridians.
HOA payments, plus additional demands for more special assessments, and building inspections, are affecting existing owners, new buyers, renters, and sellers who all have to accept or pass on these new monthly fees and special assessments. (See note below on the new Florida statutes regarding mandatory inspections for buildings that are over 30 and 40 years old.)
To get an idea from actual homeowners in South Florida, including Palm Beach, Broward, and Dade counties, here are some actual posts, and dire predictions, from Facebook posts about the South Florida HOA and insurance situation.
Actual Posts From Actual Florida Homeowners
“No one opposes them (the homeowner’s insurance rate increases), including the state insurance regulators who are in their pockets. HOAs in Florida also have a racket going. They often collect fees for the management and maintenance of their properties, so homeowners have little recourse for shoddy service. “
“Florida is run by corporations and real estate companies are the most predatory. DeSantis relies on corporations for his campaign money, so do not expect him, or his legislature to do anything for Florida homeowners.”
“My Association is in Palm Aire. Our insurance went from about $550, 000 to $1 million annually, so you know our fees are going up. Insurance is the biggest issue.”
“We better start thinking outside the box because the present insurance situation in Florida, especially South Florida, is untenable. House and condo prices will drop like bricks if insurance becomes even more unaffordable.”
“We’ve been told our concrete restoration by the president of the board that it will take 7,8, maybe 9 months we’re going on to year 5 with no end in sight. We hired a management company that has done nothing but collect checks. You are so correct in YOUR statement where’s the state that should have somebody to oversee this corruption.”
“The problem is with homeowner’s insurance, if you have a banknote (mortgage) you have to have wind storm (hurricane insurance) coverage.”
“Florida also has the second highest auto claims rates in the nation. Premium is based on risk the higher the risk the higher the premium.”
“I just received a cancel notice from my homeowner’s insurance. My condo was built before 2002 and I lived w/in 3 miles of the coast! I’ve never had a claim. Ridiculous!”
“As a realtor and long-time resident who also lives in a Condo, this all started when Tallahassee went into a special session and decided full reserves over a weekend for everyone without thinking about the implications for the people. You are not being represented by Tallahassee and need to consider who you are voting for.”
“Our condo insurance went from $800,000, which we couldn’t afford. Went into the reserves for it. Special assessments to pay it back. Then, it went up to $1.8 million. And is now projected to go up to $2.8 million next year. My board is at a loss. We can’t afford it. Plus we have our 30-year building inspection going on. I regret buying a condo (2021) Even at my low-interest rate. My question is, should I hang on because I have a low interest rate or sell and hope to find something comparable and refi if rates go down more?”
“Believe it or not buddy, it’s time to pay the piper. The engineering assessments are astronomical and then the repair cost is not to put the Band-Aid on it, patch it and paint it and then sell it to some other sucker. Pass it down the road. Those days are all done. Get ready to sell your units because the firestorm is about to hit all the buildings. Now three stories and up. You will be devastated. Unless you’ve got deep pockets. Get ready for the new reality. The fire sale has already started. You can see deals popping up when you see more than three units hit the wall. You know it’s not the ball. It’s the price you’re going to pay.”
“I’m not going to post my association, but I will tell you they notified me recently to inform me that due to rising insurance costs, my monthly fees are going up 38 percent!”
“Imagine trying to sell any of these properties and the first thing the buyer looks it’s at the maintenance fees… $500 to $750 dollars a month !!!! That’s another mortgage”
“Insurance rates and the new laws regulating full reserves on condos such as full reserves vs partial reserves hurting us not to mention the 40-year inspection/repair costs. My HOA has tripled and is now $1215/ month, I’ve paid $30,000 in assessments and have to pay another $10,000 in July. It is going to cause foreclosures and defaults. People who have retired are being hurt, and there doesn’t appear to be any relief as of next year we will not be allowed to have partial reserves.”
“Our insurance has increased over 600% in 3 years.”
“Lol seeing people posting here is funny because this is not what is just coming around this year. This goes back 2 years from now. The insurance has been doubling every year plus the inspection and milestone inspection not to mention the new rules on the elevators so you need the upgrade. Then when you rent your condo, you have people all over saying that the prices are skyrocketing and that you are high for putting a high price.”
“Concrete restoration should have been in the condo budget to be completed every 5 years depending on the age of the building. My building has always kept up with the concrete restoration. We have owned my unit for 20 years. However, the maintenance was $225 a month when we purchased back in 2004 and now our approved 2024 monthly budget is $873 a month. The majority of the increase is due to insurance premiums. Now the new law that will go into effect 1/2025 will require the condo budget to have 100% reserves for future repairs for certain items. This should have been addressed at your 2024 Budget Meeting.
“In the last 3 years went from $515 to $915 for maintenance monthly !! By next year I will have paid like 25,000 in assessments! I am broke and can’t even fix my own condo because the building taking it all because they did nothing for years!! And also because the governor changing the laws for reserves. Hard times.”
“We are in old historic Pompano right next to Pompano Middle School and our HOA raised the dues from $500/quarter to $400/MONTH. They did this unilaterally without any notice or consultation with the owners. Mind you, there are numerous structural issues in and around the properties that they haven’t even begun to address. HOAs have been running amok in south Florida for decades but they’ve become much more bold in their violations of bylaws and owners’ rights.”
New Mandatory Building Inspections for High-Rise Condominiums Can Increase HOA Fees
According to Florida statute, “if a building reaches 30 years of age on or after July 1, 2022, and before December 31, 2024, the building’s initial milestone inspection must be performed before December 31, 2025.”
There is also a 40-year building inspection. “When a building hits 40 years of age, it is mandated by the state of Florida to have a Professional Engineer or Registered Architect conduct a thorough structural and electrical inspection to ensure the safety and integrity of the structure. In the wake of the Surfside Tower collapse, this ordinance has now been expanded to all counties in Florida, not just Dade and Broward as it was previously.
“The new state law, which went into effect on May 26, 2022, created new requirements for milestone inspections of condominium and cooperative association buildings that are three stories and taller.”
