Florida HOA Lawyer Blog

Several municipalities in South Florida now appear to be starting a new trend that is likely to gain momentum in the months and years to come. These municipalities, which include West Palm Beach, Palm Beach County, Hallandale Beach and Sunrise, have changed the manner in which they bill homeowners for code enforcement repairs in an effort to force the owner to pay or face the possibility of losing their property. With so many abandoned properties winding their way through the slow pace of the foreclosure process, this change is likely to receive significant consideration and approval by many municipalities in the months to come.

It is no secret that many homes located throughout communities in South Florida, including those in homeowners associations, have been abandoned in the aftermath of the foreclosure-fueled housing meltdown. These abandoned homes take a huge toll on neighborhood property values. Many of these properties have become eyesores with broken windows, doors and fences, making them a safety and security hazard for the community at large. When this happens, HOAs and homeowners in communities without associations should contact the code enforcement department of the local municipality to request that the necessary inspection and repairs be made.

Typically, municipalities place liens on the property for the cost of the repairs. But with abandoned homes it often takes years to collect. Now, the municipalities mentioned above have approved new measures to add the costs of the repairs to the property owner's tax bill, which must be paid annually or the owner risks losing the property.

Other South Florida municipalities, many of which presumably face significant sums in property maintenance liens on abandoned homes, are bound to carefully consider this measure, as it is likely to be met with widespread approval by local taxpayers and property owners who have been footing the bill for the repairs to abandoned homes. The change should make it much easier for municipalities to continue to maintain and repair abandoned properties without the fear of taking on additional expenditures that may not be recouped for years.

Our attorneys will continue to monitor and write about important issues for South Florida communities and homeowners in this blog, and we encourage community association members, directors and managers to add their e-mail address in the subscription box on the right in order to automatically receive all of our future articles.

News reports of bulk buyers acquiring blocks of unsold units at local condo developments have become a weekly fixture in the local business pages, and the underlying financials of these deals point toward a continued healthy future for bulk buyers in the months and years to come. For many South Florida condominium associations that are slowly recovering from the foreclosure crisis, these bulk buyers can represent a major financial boon for troubled properties as these buyers start paying assessments and begin to rebuild the association's coffers.

The bulk deals have been spurred by depressed values, the foreclosure crisis and several significant changes in Florida law. Last year, the state legislature implemented a change under the Distressed Condominium Relief Act to temporarily suspend for two years many of the most daunting and financially worrisome legal liabilities that bulk buyers normally incur when they acquire more than seven units in a property and resell them to individual buyers. This temporary change in the law essentially shields bulk buyers from any legal liability and responsibility for construction defects, budget issues, turnover obligations and other statutory responsibilities of the original developer. It was intended to encourage bulk buyers to acquire blocks of unsold units from developers and foreclosing lenders, and resell them at a profit to individual buyers without having to reduce their bulk purchase price by having to budget for the prior developer's obligations under the law. The law has proven to be extremely successful.

The real estate and community association attorneys in South Florida at our firm are working closely with investors that are acquiring large blocks of units as well as with the condominium associations that are now dealing with bulk buyers, which in some cases have acquired the majority of the units in a community. We are also working with many individuals who are acquiring a unit from a bulk buyer. There are a number of required filings and regulatory obligations for the bulk buyers to comply with under the new law, and the structure of the transaction has to be well planned and documented in order to avoid the liabilities that were intended to be abolished by the new law. Failure to document the transaction correctly may create inadvertent liability on the bulk buyer.

In addition, community associations and individual buyers must recognize that they no longer have the same protections under the law in transactions involving bulk buyers, so they must work with experienced attorneys in order to seek and secure these protections. Our condominium association lawyers are working with our clients to use new contractual stipulations in the sales contracts involving bulk buyers to address some of these issues.

There are significant opportunities for bulk buyers as well as lenders and community associations as a result of this new law, but to take advantage of them it is imperative to work with a qualified attorney who is highly experienced in these matters and the recent legislative changes. Our community association lawyers in South Florida will continue to write about important issues affecting residential properties throughout the state. To automatically receive all of our future posts, simply add your e-mail address in the box on the right.