Florida lawmakers are awaiting Gov. Ron DeSantis' signature on a revised condominium safety law that's led to sharply increased fees for residents in older buildings and deep concerns for the state's condo market.
The Florida House and Senate unanimously approved changes that would give condos another year to complete structural-integrity inspections and provide a two-year pause in funding reserves following those surveys. Also, the inspections would apply to buildings with three habitable stories or more, rather than three or more stories of any space under the current law, and condo boards can use lines of credit or loans to pay for reserves.
The measures don't reduce or eliminate fees but do offer "options, flexibility, and relief," Senate President Ben Albritton (R-Wauchula) said in a statement.
After the 2021 collapse of the 12-story Champlain Towers South in Surfside, Florida, killed 98 people, the state Legislature passed a law that required aging condo buildings at least three stories tall to have safety inspections and studies on funding reserves for repairs completed by the end of 2024.
But not everyone met the deadline, and some owners said they would be forced out of their units because they can't afford the much higher monthly or quarterly dues their condo boards impose to pay for repairs. That would lead to plummeting values in older towers, real estate observers say.
In approving changes to the law, legislators said they wanted to balance housing affordability with building safety.
“Condominium living is, particularly in our coastal areas, an iconic and highly sought-after way of life, including for many seniors retiring to our state," Albritton said. "Everyone shares the goal of ensuring our condos are safe for residents who have made significant investments in these properties."
Still, it's difficult to draft legislation that appeals to everyone, given that this issue has competing interests, industry observers say. The concessions lawmakers made are concerning, according to Louis Archambault, a partner at the Saul Ewing law firm in Miami. He represents developers.
"You're indirectly saying you're OK with people living in buildings that are potentially unsound," he said. "One way or another, the money is going to have to be collected."
Law affects most condos
The state has more than 1.5 million condo units and roughly 27,000 condo associations, according to figures from the Florida Department of Business and Professional Regulation. Some observers estimate the new law could affect 70% of the state's condo stock.
Just this week in Clearwater, Florida, near Tampa, officials evacuated residents of the 43-year-old South Beach Condos III due to cracks in a pillar, according to the Clearwater Police Department. Construction crews are working to stabilize the building, police said.
Units in densely populated Miami-Dade, Broward and Palm Beach counties are home to much of the state's condo supply. The tri-county region has a population of about 6.5 million, making it the biggest metropolitan area in Florida, the country's third-most-populous state.
As of April, 30,466 coastal condo units were listed for sale in Miami-Dade, Broward and Palm Beach counties. That's up 27% from the same period of 2024 and more than double the number of listings from 2023, Miami condo consultant Peter Zalewski said, citing data from a local listing service. He's expecting condo prices across the region to tumble by about 40% as sellers in older buildings in need of substantial repairs resort to deeply discounting units.
Even with the proposed changes to the safety law, buyers will remain leery of Florida's existing condo market, said Zalewski, founder of the CondoVultures firm and the Miami Condo Investment Club.
"You have to convince someone to buy," Zalewski said in an interview. "How are you going to convince someone to go into a building? It doesn't matter what you've done or what your view is."
It's likely that lawmakers will have to come up with yet another "glitch bill" next year to address more unintended consequences of the legislation that will be revealed over time, according to Donna DiMaggio Berger, a condo lawyer with Becker & Poliakoff in Fort Lauderdale who represents condo boards across Florida.
Many boards understand the safety and financial obligations they have "regardless of how loud some owners want to scream about the costs associated with this level of fiscal and structural responsibility," Berger said in an email.
"The additional time and funding alternatives provided by this new legislation should help, but my fear is that for some owners, they may take this as a step backwards in terms of the Legislature’s commitment to making Florida’s multifamily housing stock safer," she said.