Florida Condo And Homeowner Associations Filing Chapter 11 As A Last Resort

by Deidre Woollard (RSS feed)
Jul 14th 2009 at 7:01PM

Last year, we began to see that condo associations in Florida were facing trouble. With many condo owners not paying their fees or facing foreclosure it was inevitable that the condo and homeowner associations would only be able to go on so long. The Miami Herald is reporting that with those fees remaining unpaid some South Florida condo associations are seeing bankruptcy as a way out. So far at least seven Florida condo associations have filed for bankruptcy and there could be many more to follow.

The lure for the associations is that if they are in bankruptcy the utilities they owe money to can't turn off basic services like water and power. The downside may be that it is both costly and only a stopgap measure. The condo associations still need to figure out how they are going to get their bills paid in the long run. If owners continue not to pay their dues the associations are basically hamstrung because, unlike businesses in bankruptcy, condo associations don't have assets to sell off. Potential buyers may also be concerned about investing under the shadow of a Chapter 11 filing. The bottom line is that associations basically are doing whatever they can to limp along until the real estate market picks up and happy homeowners are paying their bills once more. The only question is how long they can hold on.

Tags: condos, florida, homeowners association, HomeownersAssociation, homeownership

Filed under: Real Estate Developments

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Reader Comments (Page 1 of 1)

Jeck Jul 15th 2009 2:28AM

I've heard that this is the best time to invest in condos. Thanks for sharing this. I know of a real estate coach who could also help many in the real estate industry make money despite the current crisis.

beanspants Jul 15th 2009 6:09PM

JECK:
The best time to invest in condos? Just go to South Florida sometime (or just South Beach) and see all the half built condos littering the coast, cranes idle on weekdays. Then look up at 8:00 pm and see all the completed but nearly completely dark buildings.

If this is a good time to invest in condos, then what you see there does not compute.

South Beach and south florida in general is a sad looking area right now.

sunrays57 Jul 22nd 2009 8:07AM

If the banks would move along on forclosed condos associations would not have to worry about the fees. Also maybe the goverment needs to have the bank pay the fees if they want to sit on the condo instead of selling it for what they can get.If you think about it alot of this is do to the banks approving the loans where people could not afford it .

karen Jul 25th 2009 10:22PM

Yes it is bad here in Florida. Condos are going into forclosure left and right. Now our association is making us pay 500.00 a unit for all those that haven't paid or have gone into forclosure. This is so wrong on so many levels since I always pay mine. If anyone know if this is legal or otherwise, please let me know who I can contact. I'm having tough times too but I pay my bill, why should I have to pay others bills too.

Karen

Vince Yambrovich Aug 22nd 2009 7:50PM

Mirassou Condominium Association, Inc. in North West Miami-Dade County, FL is one such condo conversion development troubled by the effects of mounting foreclosures.

For the latest Mirassou condo crisis news, it's http://www.mirassoucondo.wordpress.com.