A growing condo crisis has gripped South Florida and a new state law requiring condominium boards to set aside reserves for repairs and maintenance is being blamed for a spike in the number of listings in the face of soaring HOA costs, according to a report.
The number of total active condo listings encompassing Miami-Dade, Broward and Palm Beach counties has nearly tripled in the span of a year as condo owners chafe under the burden of association fees that have risen by nearly 60% over the past five years.
In Miami-Dade, the median monthly condo association fee rose from $567 in 2019 to $900 this year, according to data from Redfin, which was cited by the Miami Herald.
Broward County condominium owners also saw their HOA fees, which cover necessities like utilities, water, cable television, landscaping and shared amenities, surge by 56% during that same period — from $392 in 2019 to $613 this year.
“I don’t know how I’m going to stay here if things keep going up,” Ingrid Vassell, a condominium owner from Plantation, told the Herald.
The rising HOA fees are being compounded by costly assessments that are required to repair aging buildings as well as soaring insurance costs that have been exacerbated by powerful hurricanes and storms.
In 2022, the Florida state legislature passed a bill that requires condominium boards to set aside sufficient reserve funds to pay for major repairs and conduct a study of the reserves every decade.
The bill, which was signed into law by Gov. Ron DeSantis, also requires condominium associations to provide inspection reports to owners, and if structural repairs are needed, work must begin within a year of the report.
The legislation was spurred by the 2021 collapse of the Champlain Towers South condo building in Surfside, which killed 98 people.
An engineering report on the building that was compiled in 2018 found significant structural issues including deterioration in support beams and cracks in columns.
Disputes among condo board members over how to pay for the millions of dollars worth of necessary repairs caused delays in addressing the problems, according to reports.
The surging costs have prompted an increasing number of condo owners to put their properties on the market.
In the second quarter of this year, there were 20,293 active listings of condos for sale in the three large South Florida counties, according to data from ISG World.
By comparison, there were just 8,497 active listings in the first quarter of last year.
Filippo Incorvaia, a Miami-based real estate broker, told The Post that South Florida condo owners are paying the price for older buildings being forced to get up to code.
“The migration away from older buildings is very real, and costs have become unfathomable for many,” Incorvaia told The Post.
“A building’s infrastructure dictates its market value for decades and many people are in an untenable situation.”
The silver lining for condo owners is that more new buildings are going up, which will mitigate the need for upkeep.
“Financials are more orderly and code is followed more diligently resulting in a safer end product with less surprises,” Incorvaia said, adding: “Ultimately I believe that this is a must for our community.”
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