TAMPA, Fla. — If you're a condo owner or looking to buy one anytime soon, you may have to rethink your budget.
That's according to Greg Main-Baillie—the executive managing director for construction and project management at Colliers' Development Services Group.
When it comes to Florida's condo market, he told ABC Action News that the next three years will be rough.
"The initial hit is going to be painful," he said.
According to Main-Baillie, if they're not already feeling the pinch of rising HOA fees and insurance hikes, many condo owners will soon be affected.
This comes after Senate Bill 154 and Senate Bill 4d were passed in response to the Surfside collapse.
They require condo buildings three stories or higher to be inspected every 10 years once they hit 30 years of age. Buildings within three miles of the coastline will have to get this done once they hit 25 years.
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By Main-Baillie's estimate, about 50% of condos in Florida are at or near that point, and those costs will be passed onto owners.
"A structural engineer will come and inspect the building and write up a report of any deficiencies found which then need to be corrected," he said.
But there's also another main requirement.
"The second part of the bill is what's referred to as the 'Structural Integrity Reserve Study,'" he said.
It, essentially, requires that another study be done to see how much money needs to be set aside to cover major repairs for the "life" of the building.
"Everyone is going to see a significant increase in HOA fees year over year as well as that initial assessment to repair the building," said Main-Baillie, "It's going to put a lot of people in a tight position and with a very significant adjustment in their monthly budget."
However, he went on to say that the financial strain will affect not only condo owners but also building owners.
"They're going to be a significant number of buildings that financially cannot take on that burden, and thus you will see a redevelopment of real estate specifically, I believe, within the real estate communities that have that opportunity for redevelopment," he said.
In his estimation, the condo market should settle after a few years, as fees will either be reduced or people will have adjusted.
As current owners hunker down, Main-Baillie encouraged prospective owners to keep all of this information top of mind.
"My advice to someone looking to buy a condo in this kind of market is [to] Be fully aware of what you're buying," he said.
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