Florida Condos Have Become Unaffordable for Many Buyers

Rising homeowners association fees and surging insurance premiums have made condo ownership unattractive in many parts of Florida with prices and sales reflecting this new reality, according to Redfin. New condo listings are soaring as sellers try to offload their properties in contrast to the US as a whole, where condo prices are rising, sales are holding steady and new listings are increasing at a much slower rate.

In the Jacksonville metro, for instance, the median condo price declined roughly 7% year over year in January, sales declined 27%, and new listings increased 32%. The story is similar in Miami, where condo prices fell 3%, sales dropped 9% and new listings rose 27%.

Florida’s market for single-family homes is faring better. The median sale price of single-family homes in Miami increased by double digits from a year earlier in January, sales rose 9% and new listings increased 13%.

The average cost of homeowners insurance across Florida increased by about 40% in 2023 alone, according to reports, while HOA fees are multiplying for many condo buildings. These combined forces are pushing prices down.

“Condo costs are shocking,” said Juan Castro, a Redfin agent in Orlando. “Condos that used to have a $400 monthly maintenance fee may now have a $700 fee. It’s causing buyers to rethink their plans.”

Florida’s HOA fees are increasing because there are new condo regulations in place this year in the wake of the 2021 Surfside condo collapse. The regulations require HOAs to regularly assess the safety of condo buildings, and in many cases collect more money for maintenance and repairs. HOA fees typically include a condo owner’s portion of insurance costs for the exterior of a building, while homeowners have a separate policy covering the interior of their condo.

In some situations, it’s also more difficult to attain a condo mortgage than a single-family home mortgage, even though condos are often considered a more affordable option. That’s because lenders require borrowers to have enough money to cover HOA dues, and also take into consideration the financial health of the condo building before writing a loan.

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