Lynn Knittel-Bruk wasn’t anticipating a monetary fever dream when she inherited a condominium in Lake Price, Fla., from her late aunt.
Brokers prompt the unit would fetch between $175,000 and $220,000. However when she listed it final summer season, purchaser curiosity was tepid, and he or she discovered herself competing with dozens of different items on the market in the identical advanced. Because the condominium racked up days on market, she was footing the invoice for month-to-month affiliation charges that swelled to shut to $800 a month, plus a mortgage fee.
Seven months and one Realtor swap later, the condominium lastly bought in February for round $90,000. Had the method taken any longer, Knittel-Bruk, 65, mentioned she was ready to present the unit again to the financial institution.
“It was an absolute nightmare,” Knittel-Bruk mentioned. “I had no concept that inheriting a condominium was truly going to price me cash.”
All through the state, condominium house owners, particularly these in older buildings, are more and more discovering themselves in related conditions. Condominium and townhome stock throughout Florida has surged 35% since March 2024, and few consumers have emerged at the same time as sellers slash costs.
Median gross sales costs are down 4.5%, to $315,000, since March 2024, in keeping with Florida Realtors knowledge. Models are additionally taking longer to promote — greater than three months on common — and the full variety of items bought is down greater than 9% from a 12 months earlier.
The present market correction comes as migration into Florida is slowing, and potential consumers face excessive mortgage charges and burgeoning insurance coverage prices. However the crux of the difficulty traces again to the 2021 collapse of a 40-year-old condominium constructing within the Miami suburb of Surfside, Fla., that killed 98 individuals.
A federal investigation into the reason for the collapse continues to be ongoing, however preliminary stories recommend that construction flaws that left the construction out of compliance with constructing codes performed a job. A 2018 building inspection discovered “vital” concrete cracks that required intensive repairs. On the time of the collapse, the concrete restoration work hadn’t began.
Within the years because the collapse, the Florida legislature handed sweeping reforms designed to stop one other Surfside catastrophe. The brand new legal guidelines required main inspections for many condominium buildings over 30 years outdated, and mandated the restore of any structural points these inspections revealed. The laws additionally required condominium associations to beef up the reserve funds that cowl routine upkeep like roof repairs and elevator maintenance.
Investigation ongoing: Rescue personnel work on the stays of the Champlain Towers South condominium constructing, June 25, 2021, in Surfside, Fla. (AP Picture/Gerald Herbert, File) ·ASSOCIATED PRESS
The modifications had near-instant monetary implications for 1000’s of buildings throughout the state. A lot of Florida’s condominium inventory was constructed earlier than the Nineteen Nineties, and plenty of buildings lack enough reserves. Traditionally, condominium boards might simply vote to waive or cut back month-to-month dues meant to fund repairs. Many did so in an effort to maintain charges low for house owners.
Now, the times of low cost dues are over. Entering into compliance with the brand new legal guidelines has pressured many condominium boards to hike charges and levy steep particular assessments to pay for main repairs. In lots of components of the state, HOA charges rose by double-digit percentages between late 2023 and early 2025, in keeping with Redfin. In a number of coastal communities just like the Gulf Coast metropolis of Naples, common charges now exceed $1,000 a month.
Dealing with these larger prices, some house owners are opting to promote. However as a result of few consumers are wanting to take over these funds, gross sales costs have fallen dramatically.
In Delray Seashore, north of Fort Lauderdale, part of the state the place greater than 80% of condos are greater than 30 years outdated, actual property agent Paul Lykins has witnessed the worth correction firsthand. He bought Knittel-Bruk’s condominium, and has different listings which are lingering available on the market. He and a potential purchaser not too long ago toured a unit that had been reduce to $230,000 after 46 days available on the market. Its preliminary checklist worth was $285,000.
“We’re simply seeing worth drop after worth drop,” Lykins mentioned. “I feel lots of people are nervous about shopping for condos proper now. They care for one evaluation, however then is there one other evaluation across the nook?”
The assessments and better charges will be notably untenable for center and working-class house owners and retirees who depend on fastened incomes, and their stress has caught the eye of Gov. Ron DeSantis and Florida lawmakers.
This week, the Florida legislature unanimously handed a invoice designed to ease among the strain on house owners. The laws offers condos extra time to finish reserve research, and can let associations take out credit score traces and make investments their reserves to fund repairs. Reserve fund contributions will also be briefly paused after buildings full their milestone inspections, that are required when a constructing turns 30.
Jose Pazos, founder and chief govt officer of A-Sensible Cam, which gives administrative providers to condominium associations in South Florida, thinks the brand new legislation ought to present some aid for beleaguered house owners, however the results could also be restricted. Credit score traces ought to assist condominium boards shortly meet authorized necessities for larger reserves, however it’s unclear what number of banks can be prepared to offer them, he mentioned. And the reserve contribution pause applies to some, however not all, anticipated repairs that flip up in a milestone inspection.
At most of the condos he helps handle, most of that are older, charges for house owners have doubled or tripled in recent times.
“It’s very nuanced,” Pazos mentioned. “How a lot aid is it going to present to that doubling or tripling? The repairs nonetheless must get completed.”
Florida legislators have acknowledged this a lot. Rep. Vicki Lopez, a Miami-area Republican who sponsored the brand new laws and has been dubbed the “Condominium Queen” by colleagues for her give attention to the difficulty, mentioned Wednesday throughout debate on the invoice that she plans to proceed engaged on it.
“I feel all of you know the way advanced this problem actually is,” Lopez advised fellow legislators simply earlier than the invoice handed. “We’ve strived to achieve that delicate stability between the protection of our constituents that stay in condominiums in addition to understanding the unbelievable monetary affect that generally these explicit payments that we go have.”
Jeff Lichtenstein, president and founding father of Echo Tremendous Properties in Palm Seashore Gardens, thinks the marketplace for older condos will finally discover its footing. He expects consumers to return again as soon as they’ve a clearer image of a constructing’s structural well being and condominium boards have improved their reserves.
“Folks don’t purchase when there’s uncertainty,” Lichtenstein mentioned. “Typically the uncertainty lowers the worth greater than it ought to.”
However there may very well be extra ache to return within the years forward as buildings proceed the lengthy course of of creating repairs and shoring up reserves.
“The day may be two or three years from now, or 5 years,” Lichtenstein mentioned. “I don’t know.”
Claire Boston is a senior reporter for Yahoo Finance protecting housing, mortgages, and residential insurance coverage.
