What a Florida Condo Really Costs to Own Now: Reserves, Milestones, and Special Assessments

The Low List Price That Deserves a Second Look

Ray is 67, retired, and ready to trade his house for a beachside condo in Daytona Beach Shores, where the Zillow Home Value Index pegged the typical home value at $368,000 in July 2026. He has found two units he likes. One is in a building constructed in 1988; the other went up in 2004. The older unit lists for $40,000 less. On paper, the choice looks obvious. In practice, the annual cost of owning that older unit could easily erase that gap within a few years, and the reasons all trace back to Florida law changes that took full effect in 2025.

Ray is a composite, not a client, but the math he faced is real and increasingly common for buyers shopping the Volusia County coast from Ormond Beach south through Daytona Beach Shores to New Smyrna Beach.

Monthly Dues and What They Actually Fund

Every Florida condominium owner pays monthly assessments to the association. Those dues cover two distinct buckets: operating expenses and reserves. Operating expenses are the predictable, recurring costs of running the building: landscaping, pool maintenance, management fees, electricity for common areas, liability insurance, and similar line items. Reserves are the savings set aside for large, infrequent repairs, things like roof replacement, elevator overhaul, painting, and, critically now, structural components.

Before 2022, many Florida associations voted to waive or reduce reserve funding because state law allowed it. That option is now sharply limited for buildings with three or more habitable stories. Under Chapter 718 of the Florida Statutes, as amended through HB 913 (effective July 1, 2025), those buildings must fund reserves for items identified in a Structural Integrity Reserve Study, and the membership cannot vote to waive that requirement. The practical result: dues in older, larger buildings have risen noticeably, and the increases are not finished.

When Ray pulled the budgets for his two target buildings, the older one showed monthly dues of roughly twice what the newer building charged per square foot. Part of that difference reflected deferred catch-up funding that the older building's association had to begin collecting because prior years of waivers left the reserve account underfunded.

The Structural Integrity Reserve Study

Chapter 718.112, Florida Statutes, requires condominium associations with buildings of three or more habitable stories to obtain a Structural Integrity Reserve Study, commonly called a SIRS. The study must be conducted by a licensed engineer or architect and must assess the condition and remaining useful life of the building's primary structural components: the roof, load-bearing walls, floor and ceiling assemblies, foundation, fireproofing, plumbing, electrical systems, windows and exterior doors, and any other item the inspector identifies as critical to structural integrity.

The SIRS then produces a funding schedule: how much the association must collect each year so that money is available when each component needs replacement. HB 913 raised the per-item reserve threshold from $10,000 to $25,000 (indexed to inflation), which removes some minor items from mandatory tracking but keeps the big-ticket structural items firmly in place.

Ray's first task was simple: ask for the most recent SIRS for each building. The report tells a buyer exactly how funded or underfunded the reserves are. A building that is 40 percent funded carries far more financial risk to an incoming owner than one sitting at 85 percent funded, because the gap has to be closed somehow, usually through special assessments or loans.

Milestone Inspections: Deadlines and Consequences

Separate from the SIRS is the milestone inspection. Under Section 553.899, Florida Statutes, any condominium building with three or more habitable stories must undergo a milestone inspection before December 31 of the year the building turns 30, and then again every ten years after that. Buildings that turned 30 between July 1, 2022 and December 31, 2024 had a compliance deadline of December 31, 2025. Some local governments, including certain coastal jurisdictions in Florida, can require inspections as early as 25 years based on environmental conditions.

The inspection is a two-phase process. Phase one is a visual assessment by a licensed engineer or architect. If phase one reveals concerns about structural soundness, phase two requires destructive or semi-destructive testing. The board pays for both phases, and under HB 913, the board has authority to levy special assessments and obtain loans to fund repairs identified in a milestone inspection report without a membership vote. That is a meaningful shift: an owner who buys into a building facing a phase-two milestone inspection could be assessed without any vote occurring.

Ray's 1988 building had completed its phase-one inspection. The engineer flagged three areas of concern on balcony soffits and one section of the parking structure. Phase two was scheduled for the following spring. No cost estimate had been finalized, but the engineering firm's preliminary notes suggested repairs in a range the board had not yet publicly quantified. That uncertainty alone changed Ray's calculus.

HB 913 also added an insurance consequence: Citizens Property Insurance Corporation may not issue or renew policies for a condominium unit owner or association if the association is out of compliance with the milestone inspection and SIRS requirements. For a building that loses Citizens coverage and cannot secure private coverage easily, the financial fallout touches every owner.

Special Assessments: How to Read the Budget for Them

A special assessment is a charge above and beyond regular dues, levied when the reserve account is insufficient to cover an unexpected or underestimated repair. They are common in older Florida condominium communities, particularly those that spent years waiving reserve contributions before the law closed that option.

Reading a condominium budget for special assessment risk requires three documents: the current operating budget, the most recent reserve study or SIRS, and the association's reserve account balance statement. Compare the SIRS funding requirement against the actual balance. Any shortfall is potential special assessment exposure that an incoming buyer inherits proportionally.

Florida law requires a seller to provide a condo estoppel certificate, which the association issues and which discloses any current or pending assessments, the monthly dues amount, and any known delinquencies. A buyer's attorney should also request the association's questionnaire, a separate document lenders and buyers use to evaluate the financial health of the building. Both documents should arrive before the inspection period expires under a Florida Realtors/Florida Bar contract. For a deeper look at how commission and contract terms have evolved, see how real estate commissions work in Florida after the NAR settlement, which covers the buyer-broker agreement mechanics now in play on every transaction.

Association Insurance vs. the Owner's HO-6 Policy

Florida condominium associations are required to carry property insurance on the building itself, general liability coverage, and, for some buildings, fidelity coverage for board members handling funds. What the association's master policy typically does not cover is the interior of the individual unit: the flooring, cabinets, interior walls, appliances, and personal property. That gap is filled by an HO-6 policy, which the unit owner purchases individually.

HO-6 premiums in coastal Volusia County have risen substantially over the past several years, tracking the broader Florida insurance market. The age and construction type of the building affects the owner's HO-6 premium as well as the association's master policy cost. Ray found that insurers quoted meaningfully higher HO-6 premiums for the 1988 building than for the 2004 building, partly because of construction differences and partly because the older building had not yet resolved its pending milestone inspection findings.

Buyers should request a copy of the association's current master policy declarations page and confirm that the coverage is in force and not subject to pending cancellation. Gaps in association coverage can trigger forced-placed insurance at the lender's discretion, which adds unplanned cost.

Older Building vs. Newer Building: The Real Tradeoff

The honest answer to Ray's comparison is that the $40,000 price difference was real but incomplete information. Ownership cost, not purchase price, determines long-term value. The 1988 building carried higher monthly dues, an underfunded SIRS reserve account, a pending milestone phase-two inspection with unresolved repair estimates, and higher HO-6 premiums. The 2004 building had lower dues, a better-funded reserve, no outstanding milestone findings, and more favorable insurance terms.

Neither building is inherently a bad choice. Older beachside buildings in Daytona Beach Shores often carry the best locations and direct ocean views that newer construction cannot replicate. The question is whether the buyer prices that location premium correctly after accounting for the full annual cost of ownership, not just the mortgage payment and dues line on a spreadsheet.

What This Meant for Ray

After reviewing both SIRS reports, the estoppel certificates, the association questionnaires, and the insurance quotes, Ray calculated that the annual out-of-pocket difference between the two units, accounting for dues, his HO-6 premium, and a conservative reserve for his share of potential special assessments in the older building, ran well above the carrying cost of the price gap. The newer building, at a higher purchase price, was likely the lower-cost ownership choice over a five-to-ten-year horizon.

Ray made an informed offer on the 2004 building, negotiated a price reduction based on a reserve study shortfall he identified in the questionnaire, and closed with a clear picture of what the next decade of ownership would actually cost him.

That is the work the law now requires sellers to disclose and buyers to absorb. Sellers of older Volusia County condos, whether in Daytona Beach Shores, New Smyrna Beach, or Ormond Beach, should treat their building's reserve and milestone status as a pricing factor, not an afterthought. A buyer's attorney-REALTOR® will find every document, and an underfunded reserve account will be reflected in the offer.

A CPA or licensed tax professional should run the actual numbers for your situation. Every condo purchase and sale carries details that a general guide cannot fully address.

Questions about a Volusia County condominium purchase or sale? Contact Arthur Simpson, Esq., CIPS, Attorney and REALTOR® with Realty Pros Assured in Ormond Beach, at arthursimpson.com. Arthur reviews condominium documents, reserve studies, estoppel certificates, and purchase contracts as both legal counsel and your real estate professional.