A Foreclosure "Crisis" Is Possible Due To Florida's New Condo Law, According To FL Politicians

L. Cane

Many expenses in Florida have risen over the last couple of years. Examples are housing, insurance, and energy prices.

However, some Floridians are seeing another example of price increases - raising condo fees and assessments in response to Florida's new condo law (Senate Bill 154) that requires inspections for some condos and for associations to set aside monetary reserves for the future funding of necessary repairs.

A Floridian Alleges A Condo Fee Increase of 43%: Rufina Cappelli has lived in a condo in St. Petersburg, Florida for over 28 years, according to WFLA. Cappelli told the station that for several years, her condo fees were just over $375. However, she's recently received word that this rate might rise substantially. She explained:

“It was $376 for years. Then, suddenly, in October, they said it was going up 43 percent. What worries me is that I won’t have a roof over my head.”

Cappelli is not alone. Experts say that new laws in Florida may financially impact condo owners.

WFLA indicates that some condo owners are selling their units before having to pay new, large assessments. Sara Taylor, a real estate consultant, told the station:

“People are competing to sell their properties. We’re seeing price reductions to entice buyers to come in, and we’re seeing people who just can’t afford it having to list their condos and find another place to move.”

The New Law: According to Florida-based Moorhead Law Group, a new Florida law will require that condominiums in Florida undergo inspections and set aside reserve funding, among other requirements.

These additional requirements combined with rising insurance costs could mean higher fees for Florida homeowners, according to an article by The Orlando Sentinel written in mid-November 2023.

"People Are Going To Be Losing Their Homes:" One Florida leader expressed concern to The Sentinal when speaking about the double punch of the new condo law and increasing insurance costs.

Broward County Commissioner Mark Bogen told the publication:

“People are going to be losing their homes. Foreclosures are increasing. As it looks right now, there are going to be so many people unable to live in their homes...This is going to really be a crisis in our state.”

State Representative Robin Bartleman echoed Bogen's sentiment, saying:

“We’re going to have foreclosures all across this county.”

One Way Floridians Might Protect Themselves: The Florida Real Estate Blog recommends that potential condo buyers in Florida ask if the association currently maintains both a healthy financial reserve and a contingency account. The blog says that Floridians should seek condo associations that are on track to be "fully funded" before repairs are needed.

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