High-Rise HOA Fees, what do they include? (Miami: short sale, insurance)

[panamamike]

I've been looking at a few units online that look to be good deals.
However, when I research the HOA fees and property taxes, they are out of sight!

I see property taxes much higher than the expected 2.x percent, not sure what's going on there.

The real mouth opener are the outrageous HOA fees. I'm seeing HOA fees of $500+ and not unusual to see $800+ for a 2b 2b unit.

What would I be getting for these sky high HOA fees? I not every single thing could be listed, but wondering what are the typical things included in a nice modern high rise HOA fees.

See this example. No mention if this includes property insurance ect...

THE GRAND #A-1642 - 1717 N BAYSHORE DR MIAMI, FL 33132 | Miami Condo Shop (http://www.miamicondoshop.com/listing-the-grand-unit-a-1642-358435.html - broken link)

Mike

[MiamiRob]

well according to the website it includes:
•Gated community
•On-site guard
•1 parking place
•1 car garage

I imagine it includes recreational facilities, concierge services, Marina priviledges since it fronts the bay. Property taxes reflect what the current owner is paying so if you buy it for less than what the seller did the property taxes will drop. It will be re assessed at the lower price.

[panamamike]

Originally Posted by MiamiRob

well according to the website it includes:
•Gated community
•On-site guard
•1 parking place
•1 car garage

I imagine it includes recreational facilities, concierge services, Marina priviledges since it fronts the bay. Property taxes reflect what the current owner is paying so if you buy it for less than what the seller did the property taxes will drop. It will be re assessed at the lower price.

Rob, Thanks for the input, I saw that on the link I posted. I was a bit surprised since all condos I've been involved with cover some portion of the property insurance, typically the exterior of the building. I don't know anything about how high rises work. I was hoping to get input from someone who owns such a condo in Miami or has good knowledge of this type of condo. As far as the taxes, I looked them up on the Miami-Dade tax assessors site and was surprised to see the taxes levied for 2010 where for an amount similar to the sale price.

http://egvsys.miamidade.gov:1608/www...=0132310480367

Thought they would be lower.

Regards,

Mike

[hurricaneMan1992]

Mike:
HOA would also include insurance for the exterior of a high rise, but not a dime for the inside of your unit. Condo insurance (for individuals) isn't cheap either. Most likely it includes water, basic cable, cooling the common areas, possibly valet parking, and a sizeable staff in a "full service" building (which basically all new high rises in South Florida are). You usually see 50-70 cents/square foot/month in those places. Remember, the condos were originally designed to sell for $300k and up for 1/br or studio, and at those prices, the level of service would make more sense.

You may be better off looking for an older, more high rise outside of downtown for lower HOA's, but even then they will be high compared with outside of South Florida, due to the hurricane insurance.

[panamamike]

Originally Posted by hurricaneMan1992

Mike:
HOA would also include insurance for the exterior of a high rise, but not a dime for the inside of your unit. Condo insurance (for individuals) isn't cheap either. Most likely it includes water, basic cable, cooling the common areas, possibly valet parking, and a sizeable staff in a "full service" building (which basically all new high rises in South Florida are). You usually see 50-70 cents/square foot/month in those places. Remember, the condos were originally designed to sell for $300k and up for 1/br or studio, and at those prices, the level of service would make more sense.

You may be better off looking for an older, more high rise outside of downtown for lower HOA's, but even then they will be high compared with outside of South Florida, due to the hurricane insurance.

Thanks for the feedback.

What does "full service" get you? When they say the inside of the condo do they mean, appliances, general belongings ect? I'm surprised insuring the inside is so expensive. I wonder what the insurance split is like. 50% for exterior 50% interior or the like?

It's still pretty crazy to think the HOA/insurance/tax > mortgage payment. Even at 300K price tag you're talking extra costs beyond 50% of the mortgage PI.

Any good way to find out what HOA services are included for a particular condo building?

Mike

[r_k]

One of the things you need to do is this - believe nothing, double-check and recheck everything.

For example, in that listing you linked, the property tax for 2010 is listed incorrectly as $5953. The actual property tax according to the tax records was about $3200. Who know how many other mistakes there could be.

The others posters have covered the HOA fee question pretty well. In some buildings they are high due to mismanagement, in others there are many owners not making payments. You really have to dig into as much as you can.

[panamamike]

Originally Posted by r_k

One of the things you need to do is this - believe nothing, double-check and recheck everything.

For example, in that listing you linked, the property tax for 2010 is listed incorrectly as $5953. The actual property tax according to the tax records was about $3200. Who know how many other mistakes there could be.

The others posters have covered the HOA fee question pretty well. In some buildings they are high due to mismanagement, in others there are many owners not making payments. You really have to dig into as much as you can.

Point taken, I've seen the whole HOA mismanagement thing play out and it can be pretty ugly.
Was looking to get some insight regarding where I can find more HOA/condo info.
Seems the info isn't as easy to come by as I'd hoped.

Mike

[r_k]

I am not sure it is all that hard to find. If you ask the condo manager in most cases they will tell you what is included in the HOA fee. Or, ask the realtor to find out for you (just make sure they are getting it from a good source and not just reading it off the MLS).

The slightly harder question is, why is the HOA fee what it is. I am not sure if others touched on it, but check about reserves. Some buildings save a certain amount each month for future maintenance (painting, roof etc) while others keep the monthly fee low, but then have frequent special assessments to cover repairs etc. Sometimes the fees are high due to unnecessary things like fancy pools, gyms, doormen etc that you may not care for. As you compare many different buildings you will get a feel for what is normal and what seems abnormal.

[hmontaq]

All valid reasons... Add low occupancy. A condo at 25% occupancy has to cover the 75% thats not occupied.

I just bought a short sale condo cash and the HOA is high because people are behind or not paying the HOA fees.

[panamamike]

Originally Posted by hmontaq

All valid reasons... Add low occupancy. A condo at 25% occupancy has to cover the 75% thats not occupied.

I just bought a short sale condo cash and the HOA is high because people are behind or not paying the HOA fees.

Congratz on the new Condo.

Does this mean the current HOA fees are unusual due to the market crash? Or are they typically just this high, meaning .50 a sqft.?

I saw one or two folks posting "horror" stories about how the condo fees just go up every year. One person cited the example of starting at
$23.00 in 1982 then 10 years later hitting $350.00 Don't know the particulars and I know builders are notorious for starting out with artificially low HOA fees to attract buyers, but I wonder if this ever corrects or flattens out...

My thought was massive high rise condos where built to a higher standard and should require less maintenance for say the first 20 to 30 years. I do know elevators can be an issue, but don't know what else drives HOA costs in a high rise. Cleaning the exterior maybe?

Mike