About Senate Bill 1196 & The FLORIDA Distressed Condominium Relief Act - Leave Your Thoughts!

During this tough economic time, condominium associations and homeowners have taken a beating. On July 1st, 2010, Charlie Christ signed Senate Bill 1196 which included The Florida Distressed Condominium Act...so what does this mean for future buyers and current owners?

"The new law sets the table for condominium associations to become financially stable, Fannie Mae to approve more projects for financing, and bulk buyers to purchase with less risk," according to Bill Worrall, who helps manage an estimated 350,000 condominium units in 1600 communities throughout Florida, Alabama and Mississippi, as vice president of The Continental Group, Inc.

As reported by David Fletcher of Realty Times,in past recessions, the recovery depended on thousands of permanent buyers and small investors buying one or two condominiums at a time. This time, the recovery depends on cash-rich 'buy and hold' investors purchasing hundreds of developer or lender owned condominiums in bulk, who plan to hold them for three-to-five years then resell them.

The bill will have the biggest impact on lenders, condo associations and developers, leaving some current home owners asking..."Is this REALLY going to help ME?". The hope is, yes, in time, what is good for the association and economic recovery, will be good for everyone.

The Highlights:

• Associations will see their association collections improve, because the Association has the ability to collect rent from then tenant to pay the association fee if the owner does not pay it. This increased cash flow means they can upgrade their communities, thereby increasing property values.
• Fannie Mae will approve more communities for financing, which will bring more real estate agents back into the condominium market.
• More properties will become FHA approved, because they financially meet association and other guidelines.
• Bulk buyers will become more aggressive, because their liability for unpaid association assessments is greatly reduced under the new law.
• Fannie Mae will , on a case-by-case basis, approve condominiums properties they may have turned down. Thanks to tenants paying the monthly association fee, can provide financials that meet Fannie Mae guidelines.

A Few Things Real Estate Agents & Buyers Should Consider

"Tenants are responsible for the monthly association fee, but the law is not clear on how much, if anything, tenants are obligated to pay the association for past due association fees owed by the landlord. This could prove embarrassing for a Realtor who may have placed a tenant in an investor's unit, and the investor, unbeknownst to the tenant, had not been paying his association fee", according to Worrall, who helps manage an estimated 350,000 condominium units in 1600 communities throughout Florida, Alabama and Mississippi, as vice president of The Continental Group, Inc.

When considering the sale or purchase of a unit, always request an account history report from the Association showing the maintenance fee balance on the unit. This can be a helpful negotiating tool (for both buyers and listing agents). This can help if obtained and discussed before the closing, which as agents well know is where many issues occur.

Research and be aware of Fannie Mae-approved Associations. "Fannie Mae approved" means the association is approved for lender financing, which makes the property more marketable as a listing and more saleable to a when representing buyers. For non approved Associations, the buyer may be limited to a cash investor or require 20 percent down.

Other Bullets from Senate Bill 1196 that Effect Associations

• Exempts certain elevators from specific code update requirements.
• Revises the limitations on the right of members to vote on corporate
  matters for certain corporations not for profit that are regulated under
  specified provisions.
• Specifies the maximum amount of any unit owner's
  loss assessment coverage that can be assessed for any loss.

Realtors, Condo Owners, Developers and Buyers are all hoping this bill will bring lots of sunshine, to the sunshine state.

For a list of Fannie Mae approved Condo Associations in Florida, or more information on the local market trends and great places to buy in Manatee & Sarasota County, call The Burish & Serena Team! When experience counts, count on Burish & Serena.

www.USA-FloridaHomes.net