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HOA is the abbreviation of “Home Owners Association”. The so-called “HOA Fee” or “Home Owners Association Fee” is the fee that each owner must pay to this association so that it can meet the maintenance of the condominium and other expenses related to the best interest of the community. This is considered one of the main expenses related to the property in Florida.
The HOA fee is usually charged monthly, but it is very common to be also charged every quarter or even every semester, depending on the condominium.
Who should pay the HOA fee?
The responsibility for paying the HOA fee is the owner of the property, even when the property is rented. In other countries this situation is different. For rented properties, both the condominium fee and the property tax (Property Tax) are the tenant’s account. Not in Florida! HOA and also the property tax are paid by the owner. Therefore, when calculating the return on the rental of a given investment, take this information into consideration.
IMPORTANT: Be very careful to keep the HOA payment up to date. The idea is to put it in automatic debit at the bank! The default of condominium fee payments can generate discomfort, including in the judicial sphere. And in the United States the laws are considerably strict. We recommend opening an account at a US commercial bank for this.Opening a bank account in Florida is simple, just present your passport!
What is the value of the HOA fee in Florida?
The HOA fee varies greatly depending on the condominium. Some condominiums offer very high luxury services and amenities, which generates higher maintenance expenses. The age of the condominium also influences, since older properties generate more maintenance.
In Orlando, the value is usually between $100 and $600. In Miami, a rule we usually use is to adopt the value of US$ 10 (ten dollars) per square meter. It’s just a reference, since, as mentioned, everything will depend on what the condominium offers and what it generates in maintenance.
Individual residential houses, the so-called Single-Family Homes, usually offer a lower condominium rate than townhomes or apartments. Single-Family homes are single residential houses (not semi-detached). Stay on top of the types and terms of properties in Florida.
Why does this happen?
Townhomes are similar to apartments, where the facade of the property, roofs and some other structures are shared. It’s like a horizontal building. The maintenance of the facade of the townhomes and apartment buildings is done by the Association (Condominium). The maintenance of the roofs and gutters are also the responsibility of the condominium. That’s why the value of the condominium tends to be higher, since every 5 or 6 years the facade must be painted and the roofs repaired or changed.
In a Single Family home, the owner is responsible for the painting and maintenance of the roofs and gutters. Therefore, although the HOA fee is usually lower in Single Family houses, the owner will incur higher maintenance expenses.
In Vacation Homes, that is, houses intended for vacation seasons, the HOA is usually higher. That’s because these holiday condominiums near the parks offer an incredible leisure structure, as if they were resorts. To cope with the maintenance of such a complex structure it is necessary to have a higher HOA. Examples of condominiums with a large leisure area are Storey Lake, Solara Resort and Windsor Island. Below is an aerial photo of the Windsor Island recreation area.
That’s why it’s important to always question your broker what is included in the HOA of the community where you are buying a property in Florida. Learn more in the next topic!
What is included in the HOA fee?
The HOA fee concerns all the maintenance of the common areas of the condominium: landscaping, lighting, maintenance of streets and sidewalks, painting of common areas, gym, swimming pool, etc.
Some condominiums now include in the HOA fee the maintenance of the individual gardens of the houses. This initiative was very welcome in the market, since it preserves the aesthetics of the condominium as a whole, valuing the properties of that community. In some older condominiums, the individual gardens of the houses are not part of the HOA and, with that, some owners do not take care of them the way they should, compromising the appearance/visual.
In Vacation Homes the condominium fee also usually includes cable TV, internet and even telephone expenses. Most vacation condominiums also include garbage collection, as is the case with The Retreat at Champions Gate. Encore Resort at Reunion, on the other hand, is more differentiated, offering extra services such as pest control, maintenance of the private pool of each unit and cleaning of the exterior of the residence. Services can vary greatly depending on the condominium.
That is why it is important to always compare the HOA rate with the benefits that the condominium offers. Often the value may seem high, but it compensates for the diversity of services. Remember that in the case of Vacation Homes it is important that the condominium offers services and amenities to its guests, since the goal is, most of the time, also to obtain income with rent in the periods that the owner is not using. The greater the number of services and amenities, the more competitive the condominium is in relation to the others, allowing you to charge higher daily rates and, consequently, have a better ROI.
About AMG International Realty
AMG International Realty is a global real estate agency specialized in Florida and aimed at the foreign public. If you want to know more about which condominiums in Miami offer the best houses, services and what is included in the HOA of each of them, contact me right now and chat with me on WhatsApp: +1 305 761 2655 (Heloisa Arazi)
