Florida's already fragile condo market faces devastating final blow

Daily Mail​

6 hours ago

Florida 's already faltering condo market is about to get hit again — quite literally —with hurricane season headed the state's way.
As hurricane season ramps up, forecasters are warning of an 'above normal' number of storms — threatening to push an already fragile sector to the brink.
Condo communities across the Sunshine State are still reeling from skyrocketing HOA fees, steep maintenance costs, and tough new building laws passed in the wake of the Surfside collapse.
Now, experts say a major storm could deliver a knockout punch.
'As a Florida resident, I certainly hope we are spared a direct hit this hurricane season,' Alessandra Stivelman, partner at Eisinger Law, told DailyMail.com.
'But from a legal and structural perspective, Florida condominiums are currently facing what I would describe as a perfect storm of vulnerability — both physical and financial.'
'After several relatively quiet hurricane seasons on the east coast, any significant storm now has the potential to inflict far more than just wind or water damage.
'It could expose and magnify deep-seated issues that have been building for years, including deferred maintenance, underfunded reserves, insurance gaps and a lack of readiness for new legal requirements.'
Many of Florida's condos were built decades ago — long before modern hurricane codes. That means no storm-rated windows, no reinforced roofs, and poor waterproofing.
But even newer buildings aren't necessarily safer. Some suffer from poor upkeep or are ill-equipped to handle storm surge and prolonged flooding.
'Condominiums, especially those located in coastal and flood-prone regions like Florida, are inherently vulnerable to hurricanes due to their high-density, multi-story construction and shared infrastructure,' Stivelman says.
Heavy rains, even outside of hurricane season, can overwhelm existing infrastructure and lead to water seepage, flooding and mold—problems that are difficult and expensive to fix.
Over 8 million homes in Florida are at risk of suffering moderate or greater risk of hurricane wind damage this year, while over 2 million are at risk of significant storm damage, says a new report by Cotality.
The National Oceanic and Atmospheric Administration (NOAA) predicts a dangerous hurricane season, which officially began on June 1 and will continue until November 30.
They project 13 to 19 heavy storms, 6 to 10 hurricanes and 3 to 5 major hurricanes.
With predictions of up to 19 named storms and five major hurricanes, residents of the Sunshine State – many already paying the highest home insurance premiums in the nation – are petrified.
Over the last five years, several major natural disaster insurance providers have pulled out of Florida entirely or have slashed their coverage options, citing unsustainable catastrophe exposure.
While many homeowners have watched their premiums triple, NerdWallet reports the annual cost of home insurance in Florida is now $2,625, which is 24 percent above the national average.
Champlain Towers was in the midst of its 40-year structural review when it collapsed without warning in the early morning hours of June 24, 2021, killing 98 people
Florida's condo owners are facing even more challenges, many of them tied to sweeping legislation introduced in the aftermath of the tragic 2021 Surfside condo collapse.
The new building safety law, which includes mandatory inspections and strict reserve funding rules, has had a major effect on HOAs and reserve funds.
'With the recent implementation of Florida's Milestone Inspection and Structural Integrity Reserve Study (SIRS) laws, associations are under immense pressure to fund repairs and reserves simultaneously,' Stivelman says.
'A hurricane event could trigger emergency structural assessments, accelerate statutory deadlines, and force boards to make immediate financial decisions, often without sufficient insurance proceeds or reserve funds in the bank.'
Stivelman adds that In some cases, associations may find themselves unable to meet both the regulatory obligations and the financial burden of post-storm recovery.
'The impact is not just property damage; rather, it's about legal compliance, market stability, and the long-term viability of aging buildings across the state,' she says.
Florida condominiums are undeniably more vulnerable today than in prior years, not solely due to physical aging or deterioration, but as a result of a complex convergence of financial, regulatory, and environmental pressures layered atop existing structural risks, according to Stivelman.
'Many of the state's condominium buildings include aging structures that are increasingly susceptible to significant damage under storms and post-storm conditions,' she says.
The aftermath of Hurricane Helene in 2024 leaves buildings demolished
'Additionally, continued urban development without commensurate investment in stormwater infrastructure has increased the flood risk across the state—even in the absence of hurricanes.'
With all of the problems at hand, many are choosing to sell—but the flood of listings has left the market oversaturated and buyer interest has been sluggish.
There are a few things condo owners can do to prepare for hurricane season.
First of all, condo owners should understand that living in a condominium means sharing financial responsibility for the upkeep of the entire building, not just their individual unit.
A multi-residential housing model, and major repairs like roof replacements, structural work, or waterproofing must be planned and funded collectively.
'If you are an owner and you are not consistently contributing to reserves through your dues, then when a major repair is needed, the cost will come due all at once, whether through a special assessment, a personal loan/refinance, or even being forced to sell,' says Stivelman.
'Owners should expect these expenses and plan accordingly.'
She adds that in addition, active participation in condominium meetings and staying informed are essential.
Florida condominium owners may qualify for assistance through several state and local programs designed to ease the financial burden of storm-resilient upgrades
'Understanding the building's financial health, upcoming repair needs, and the legal obligations of both the owners and the association is critical,' Stivelman says.
'Florida law now requires more transparency and financial responsibility from associations, but it's up to the owners to remain engaged, ask questions, and hold boards accountable.
'Knowledge and involvement are key to avoiding unnecessary surprises and ensuring the long-term stability and value of your property.'
Florida condominium owners may qualify for assistance through several state and local programs designed to ease the financial burden of storm-resilient upgrades and regulatory compliance.
For instance, the My Safe Florida Home Program offers matching grants for improvements such as impact-resistant windows and doors, while Miami-Dade County's Condominium Special Assessment Program provides low-interest loans to eligible owner-occupants facing significant assessments related to building repairs and recertification.