The disaster emerged within the wake of the Surfside condominium disaster in 2021, a collapse that noticed 98 individuals lose their lives and led to mandates for structural inspections and reserve funds to cowl potential repairs.
Purchaser confidence has plummeted – and fewer than 1 / 4 of condominium associations all through the state are presently assembly these new requirements, the Division of Enterprise and Skilled Regulation says.
The brand new regulatory oversight has had a big effect on lending in Florida, realtor Alexei Morgado informed Mortgage Skilled America. “The condominium market is within the midst of an ideal storm,” he mentioned. “The mixed impact of those new legal guidelines remodeled 1,400 condos in Florida ineligible for the usual mortgage. Consumers now depend on non-QM loans to purchase condos in Florida, and the charges and phrases are worse.”
Insurance coverage, HOA charges proceed to surge
In the meantime, insurance coverage premiums are on the up resulting from local weather dangers and people structural considerations, and Morgado mentioned HOA [homeowner association] charges and particular assessments have “skyrocketed”.
“It’s not remarkable for month-to-month HOA dues to exceed $3,000,” he mentioned. “Insurance coverage prices within the Florida condominium market have climbed resulting from elevated local weather danger, which has led some insurance coverage firms to withdraw from the condominium insurance coverage market utterly. The insurance coverage is one other hurdle as a result of buildings with out full protection can not qualify for a Fannie Mae-backed mortgage.”
