Client Status Request
BLOG
Communities with associations come with many advantages, and the particulars of buying/selling or renting in such enclaves should not come as a surprise for anyone.
In accordance with Florida law, buyers of a condominium unit have a statutory right to cancel their transaction within the applicable recission period after executing a contract and receiving a current copy of the condominium community’s governing documents. These will include the declaration of condominium, articles of incorporation, bylaws, rules of the association, most recent annual financial information, and a frequently asked questions and answers document.
The documents for condominium and homeowners association communities may list restrictions regarding pets, vehicles, parking, rentals, noise, and many other issues. The broker/agent or salesperson should advise the buyer to consult with experienced association legal counsel to review the documents and discuss the potential impact of any restrictions on their plans for the property.
Florida law allows a condominium association to charge transfer-related fees for the sale, mortgage, lease, sublease, or other transfer of a unit only if the association has the authority to approve such transfer, and the fee is expressly included in the governing declaration, articles or bylaws. The fee may not exceed $150 per applicant other than the husband/wife or parent/dependent child, which are considered one applicant. Such fees are to be used for screening and transfer approval, and not for capital contributions.
Homeowners associations do not have this restriction. Many developers charge a one-time capital contribution when the builder sells a residence to its initial buyer. In some cases, these funds are set aside and delivered to the HOA at turnover to provide the community with start-up funds.
After turnover from the developer, the HOA that is then controlled by the unit-owner members may be able to continue to charge a capital contribution fee on resales. The amount of such a fee is then regulated by the association’s documents, which the unit-owner members can amend to adjust.
Associations may also charge a fee for the screening of rental tenants if such provisions are contained in their governing documents.
Florida community associations may also collect a security deposit from a prospective tenant if their governing documents so stipulate. Such security deposits protect the association’s common elements and areas from any potential future damage caused by the tenant, and they are capped at one month’s rent for condominium associations but there is no cap for HOAs (other than the reasonableness standard).
These and other measures stipulated under Florida law as well as most governing documents are designed to provide uniform disclosures and reasonable fees for all those who are buying, selling or renting in communities with associations.
Our firm’s South Florida community association attorneys write about important matters for associations and other property owners in this blog and our Miami Herald column, which appears every two weeks on Sundays, and we encourage association directors, members and property managers as well as all property owners to click here and subscribe to our newsletter to receive our future articles.