5 Things to Know Before You Buy in Florida

If you’re gonna buy a home in Florida, you need to know these 5 major expenses to look out for first.

Florida’s a great place to buy, and I’ll show you how to do it the right way. But there are a few traps here that catch a lot of people off guard. If you miss one of these five things, it can add thousands of dollars and a whole lot of stress. The good news is every one of them has a simple fix if you know what to look for before you buy.

1. Rehabbers Not Pulling Permits

A lot of flipped homes in Florida look brand new, but the work was never permitted. When that happens, the city hits the new owner with the violations. Some buyers in Miami have paid $20,000 to $40,000 fixing unpermitted electrical, plumbing, windows, and roofs.

The problem is permits don’t always show up on a title search, and the inspector isn’t checking them. The fix is simple. Check permits yourself, or have your Realtor do it, before making an offer. Many cities let you search online. If the home is in St. Petersburg, you can look it up here:

https://stpe-egov.aspgov.com/Click2GovBP/selectpermit.html

If your city doesn’t have an online system, call the building department and tell them what the listing says. For example, if it’s advertising a brand new roof, windows, and AC, let them know. Then ask if permits were pulled for any of that work and if any are still open. If not, the seller has to take care of it before you buy.

2. Community Development District

A Community Development District, or CDD, adds long-term costs most buyers don’t know they’re responsible for. Developers use CDD’s to borrow money to build roads, sidewalks, sewers, and neighborhood amenities in new subdivisions. Homeowners then pay those loans back over about 30 years. Some families pay over $4,400 a year. The Florida average is $1,800.

These charges show up under “non-ad valorem assessments” on your tax bill or TRIM notice. The fix is asking the right questions. Before you make an offer, ask your realtor:

• Is this home in a CDD or special taxing district?

• How much is the annual fee and how many years are left?

• What’s the total I’ll pay over the life of the bond?

• Are there extra maintenance fees even after the bond is paid off?

A good agent can pull the tax bill, CDD disclosures, and the TRIM notice so you know exactly what you’re signing up for.

3. Reassessed Property Taxes

The property tax you see on Zillow is what the seller was paying. It’s almost never what you’ll pay. In Florida, your taxes reset the year after you buy the house. They reset to the price you paid. So if the seller bought the home 20 years ago, their taxes look low because they’ve been capped for a long time. Yours are gonna uncap, get reassessed based on your purchase price, and then cap again. Most buyers in Florida see their taxes jump about $2,500 the first year, and if you’re buying a more expensive home, it can be a lot more than that.

The fix is to run the real numbers before you even make an offer. Most counties have a tax estimator where you type in the address of the home you want to buy and your actual purchase price, and it will tell you your new property tax estimate. If you’re in Pinellas County, you can use this tool: https://www.pcpao.gov/tax_estimator

Plug in your numbers and you’ll see the real tax bill instead of the old one.

4. HOAs

Florida has about 50,000 Home Owners Associations, or HOA’s, and 64% of owned homes in the state are in one. Cities love HOA’s because they got all the benefits of new housing without paying for things like street repairs, drainage, or landscaping. It was like outsourcing basic services to the homeowners… while still collecting property taxes. The average HOA fee for a single-family home in Florida is $275 a month.

Some HOAs are great. They help keep crime down, keep the community looking nice, and keep things in the neighborhood running the way they should. But others nitpick little things, waste money, and make the neighborhood a pain to live in.

The fix is to do your homework up front. Have your realtor pull all the HOA documents before you make an offer. Look for financials, rules, reserves, and any upcoming assessments. And talk to neighbors. They’ll tell you in five seconds if the HOA is great or a total headache.

5. Flood Zones

If the home is in a flood zone and you’re financing it, you have to carry flood insurance. Newer homes that are raised up above the flood zone might only cost a few hundred a year. Older ground-level homes near the coast can hit $5,000 to $10,000 a year or more. The Florida average is about $850 for flood insurance.

The fix is checking the flood zone before you fall in love with the house. Use FEMA’s map here: https://msc.fema.gov/portal/home

Unless you’re buying a waterfront home, it’s a good idea to avoid flood zones altogether. And never fall for the line, “this neighborhood hasn’t flooded in a hundred years.” That’s the kind of thinking that gets people in trouble.

Florida is an amazing place to live. It’s truly paradise. You just want to know what you’re walking into so you don’t get blindsided. I break all this down step by step in this video and you can watch it here: watch the full video now

If you need a great Florida realtor, connect with my wife Monika here: https://forms.gle/MEWEMZEzGtyKDoTm6

Monika is a licensed real estate agent who can help you connect with a trusted agent anywhere in Florida. I’m not licensed in real estate and don’t take part in any deals or earn referral fees. I’m just pointing you to someone I trust who’s great at what she does.

Grant Warrington

Think like an Investor

YouTube Channel

P.S. Everything I talked about above, I break down step-by-step in this video — click here to watch it.