Bipartisan condo reform legislation heading to governor allows lines of credit

Relief could soon be on the way for Florida’s condominium owners — and the battered condo market.

Florida lawmakers on Wednesday approved legislation that would allow condominium associations to take out a line of credit for needed maintenance taking the onus, at least in some part, off unit owners.

The legislation, House Bill 913, passed unanimously in the House and Senate.

It now awaits Gov. Ron DeSantis’ signature.

“This landmark piece of legislation provides the financial relief and ensures building safety for the condo residents in the state of Florida,” the bill’s author, Rep. Vicki Lopez, R-Miami, says in a social media post.

In addition to allowing associations to fund their reserves through a line of credit, the new legislation gives residents greater flexibility to pause payments to their reserves while they prioritize needed repairs, extends the deadline by which associations have to complete structural integrity studies and exempts some smaller buildings from having to do those analyses, according to a breakdown from the Associated Press.

The changes come in response to backlash over condo safety rules approved in 2022 and updated in 2023 after the collapse of the 12-story Champlain Tower South in Surfside June 24, 2021.

The law requires milestone inspections for condominium buildings more than 30 years old and requires that condominium associations have enough money in reserves to pay for issues affecting the structural integrity of a building and for maintenance identified in a structural integrity reserve study.

A building will have to be inspected once it reaches its 30th birthday — based on when it received its certificate of occupancy.

While the rules were meant to shore up safety in older condominium towers to avoid a repeat of the Surfside collapse that killed 98 people, the unintended consequence was that they financially hamstrung unit owners who faced harsh special assessments and rising fees as associations looked to make needed fixes.

The rules also contributed to a downturn in the resale market as owners unable, or unwilling, to pay higher assessments and association fees put their units up for sale. The market then slowed as prospective buyers balked because they would haveto pay the higher fees and pay the higher assessments.

According to a report issued by Redfin in February, the median price for a Gulf Coast condominium dropped 4.8% in January when compared with the same time frame last year. The price for a unit on the east coast of the state fell 3%.

DeSantis, who has pushed for reforms, is expected to sign the bill.