community development fees (mortgage, percentage, price, property)
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So, once our daughter is finished with HS this year we are planning to move. This place was perfect for her (and us at the time) because it's right across the street from her HS. But she'll be leaving the nest and, if I know her, will be staying out once college is over.
I've been looking in the area we want to move to and there are several new developments where we could choose our house plan and get exactly (or near to) what we want.
What I'm debating over is if the community development fees are worth doing this. I about choked to find out they were around $2k per year.
I have no experience with a community that has these fees. I don't know the questions to ask, the pitfalls, the perks.
So, once our daughter is finished with HS this year we are planning to move. This place was perfect for her (and us at the time) because it's right across the street from her HS. But she'll be leaving the nest and, if I know her, will be staying out once college is over.
I've been looking in the area we want to move to and there are several new developments where we could choose our house plan and get exactly (or near to) what we want.
What I'm debating over is if the community development fees are worth doing this. I about choked to find out they were around $2k per year.
I have no experience with a community that has these fees. I don't know the questions to ask, the pitfalls, the perks.
So - should I pursue this or not?
Off the top of my head:
What amenities do these fees buy you?
How do these fees compare to existing developments with similar amenities?
$2,000 a year is about $166 a month. Compared to fees in my region, that's not terribly expensive. We bought in an HOA where our fees are about $75 a month but when we were looking at homes 7+ years ago - some fees were $300+ a month.
Is this fee added to your tax bill forever, added for some specific amount of time, or a one time fee?
In areas I've lived in previously, the town or city or county might charge a community development fee to the builder. It was a one time fee to defray the "costs" associated with additional services needed in the community that came about because of the development. By services think about fire, police, parks, libraries, etc. Typically a buyer never was aware of the fee as the builders just added it to the house price.
The fees are usually part of the tax bill for a set number of years, rather like a mortgage. The duration will vary by development/community.
This is fairly common in Florida, but I'm not from here so I'm just unsure about the whole thing, including how to look up (if there is any way to do that) what the fees are and their duration online. So far I've visited a couple of new developments and the $2k~ish fee is pretty much what I've been told from each.
Sounds like a MUD tax to me. Its the cost of building the infrastructure - roads, sewer, water, etc. Typically 15-30 years of taxes until its paid off.
Like I said, I don't know much about it in general. I really like a few of the floor plans that I've seen. Cost per sq ft is reasonable for the house, land and location. But these fees are tripping me up. I get why they have them, but I don't know how to compare/contrast or generally asses if the value is worth the cost.
I just don't know enough about them. So I don't know if it's worth spending my time on looking into these developments.
I'm in my 50's so a 30 year CDD fee will outlive me, or outlive my ability to stay in this home, most likely.
In my area of Florida, there are 2 parts to the CDD fee/tax. The larger part covers ongoing maintenance and management of things like parks, lakes, roads, street lights, irrigation, etc. The smaller part pays off the bond (typically 30 years but not always) which the developer uses to fund the infrastructure and all that includes. Buyers have the option of paying off the bond in full at any point and you might consider trying to negotiate that payoff as part of your deal although that wouldn’t be my choice.
Some people look at CDDs and think it’s a terrible idea. Others see the value in the added cost. I think it all depends on the development. Like everything else, there are potential pitfalls and benefits.
What percentage of your assessed value is this $2000? As someone else mentioned, it sounds like a MUD, which usually insinuates that there are no city taxes, otherwise the city would pay for the infrastructure. Is this property located within a city limit, or are you saving on no city taxes?
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