Reforms aimed at housing safety may cause trouble in the Florida condominium market

Reforms aimed at housing safety may cause trouble in the Florida condominium market

Condominiums have long become the go-to choice for retirees who do not need large spaces, young professionals who are only beginning their independent lives, and residents of northern states coming to Florida for winter months. However, the bill aimed at preventing catastrophes such as the collapse of the building in Surfside may lead to chaos in this residential property sector.

Associations of condominiums throughout Florida have been traditionally postponing current repairs and not creating reserves for repairs in the future to minimize the costs for homeowners. In some buildings, these backlogs go back several decades. Now, when the new law has been passed, old buildings will have to undergo regular inspections and condo associations will be obliged to lay by funds for upkeep. This will entail a sharp surge of payments for homeowners, explains Martin Schwartz, Partner at Bilzin Sumberg (a law firm that specializes in this kind of real estate).

All buildings three storeys and higher built more than 30 years ago must pass a benchmark inspection by December 31, 2024, which will serve as a basis for subsequent inspections every 10 years. Buildings within 3 miles of the coast must get the first inspection 25 years after completion of construction.

Condo associations’ reserves will be evaluated by professionals every 10 years and cannot be waived. The law that comes into force in 2025 is expected to affect approximately 28,000 condominium associations throughout Florida. There are concerns that owners of these properties will start selling them urgently to reduce the expenses.

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