Last Update: 04/18/16

In Florida, there are different types of home ownership recognized by the Florida Legislature other than the traditional single family home. Florida laws recognize five different alternatives that anyone considering buying residential real estate in Florida, for their vacation home, their retirement home, or an investment property, needs to know. (And, yes, the real estate agent should be apprising you of the differences when you are considering properties to buy ).

These five residential property ownership options are: Cooperatives, Condominiums, Community Development Districts (CDDs), Homeowner Associations (HOAs) and Time-Shares.

1. Florida Cooperatives

In a Florida Cooperative, you don’t own the land or the fixtures or the improvements built on the land. Instead, you own stock in a corporation. The corporation is the real estate owner; you are a shareholder in the corporation.

As a result, the corporation is responsible for things like paying property taxes and maintaining the property condition. You, as a shareholder, own stock that carries with it a right to occupy a part of that holding via a proprietary lease.

Florida cooperatives are governed by the Florida Cooperative Act, which is Chapter 719 of the Florida Real and Personal Property Code.

2. Florida Condominiums

In a Florida Condominium, you do own real estate in “fee simple” but you only own your individual unit in the bigger condominium complex. This might be one of the many beautiful condo towers here in South Florida that offer ocean views from balconies, or it may be a condominium that is a few stories high with only a dozen units or so, located in a neighborhood convenient to shopping centers and entertainment venues.

Thing is, by owning a condo you are entering into a shared community environment, where you are agreeing to abide by rules and regulations set up for the condominium as a whole — these are set out in the condo documents (declarations, bylaws, etc.) which are to be provided for review to potential buyers prior to purchase.

As a Florida condo owner, you also own a part of the common areas of the condominium — the pool, the parking lot or garage, etc. — but it is in an “undivided interest.” No Florida condo owner can point to a section of the tennis court, for instance, and claim exclusive ownership of that spot.

Florida condo owners pay property taxes on their individual condominium unit. When they sell their unit, they transfer ownership by a real estate deed just like owners of a single family home in the suburbs.

Florida condominiums are governed by the Florida Condominium Act, which is Chapter 718 of the Florida Real and Personal Property Code.

3. Florida Time Shares

In a Florida time-share, you are agreeing to own a specific property in a shared ownership with others, or to own only the right to occupy that property for a specific time period. There are a variety of legal alternatives in owning a Florida time-share, with different rights and remedies regarding the scope of your rights to use the specific property.

Florida Time Shares are governed by the Florida Vacation Plan and Time-Sharing Act.

4. Florida Home Owner Associations

In a Florida Home Owner Association (HOA), the owner of property within the boundaries of the association is legally required to be a member of the Homeowner’s Association as a condition of owning the real estate. It’s not an option. As an owner in a neighborhood with a Florida Homeowner Association, you can vote (or assign an agent to vote on your behalf) on association business.

The Home Owners’ Association itself is a Florida corporation that is legally responsible for maintaining, upkeep, etc., of the community. Assessments are placed on property within the community in order to fund the Homeowner Association’s work and if the owner fails to pay his or her assessment, the HOA can place a lien on the property.

Florida Homeowners’ associations are governed by Chapter 720 of the Florida Real and Personal Property Code.

5. Florida Community Development Districts

In a Florida Community Development District (CDD), a special purpose governmental unit is created with limited functions in order to provide urban community development in specific parts of Florida. This unit, a “community development district” or CDD, is able to tax or levy assessments upon those who own property within its boundaries as the CDD determines is best.

The CDD itself is overseen by its Board of Supervisors, who are 5 people elected by land owners to serve on the board. They hire a district manager who handles the actual operations.

Anyone purchasing property within a Florida CDD should expect to see the legally required disclosure in their documentation, letting them know that they are buying real estate within a CDD and can expect that the CDD may impose taxes or assessments upon the property in order to fund or pay for the upkeep of public facilities or services within the district itself. These would be in addition to any taxes or assessments that the property owner may be required to pay as property taxes or other taxes imposed by county or local government.

Florida CDDs are governed by the Uniform Community Development District Act of 1980, found in Chapter 190 of the Florida Planning and Development Code.

Consider Before You Buy

Before you go ahead and buy a home or condo within one of these ownership alternatives, you may want to understand the legal ramifications of living and owning property within them. For some people, these alternatives provide just what they want or need.

A Florida condo offers a great lifestyle for those who don’t want the hassle of pool upkeep but enjoy their morning swim, for example. A Florida time-share may be a great idea for someone who is considering uprooting their family from some snow-covered state and relocating to sunny Miami: spending a couple of years in South Florida with time-share ownership may be a great stepping stone for them.

However, each option has its limitations and real estate agents are legally required to disclose properties that are limited by these legal alternatives to anyone considering a purchase in one of them. That’s because the laws that apply to owners in a condo, time share, CDD, HOA, or Co-op may be an unwelcome surprise to some who don’t want to share in ways that each of these options requires real estate owners to do.

A good piece of advice is to at least speak with an experienced Florida real estate lawyer to learn about your rights. Most real estate lawyers, like Larry Tolchinsky, offer a free initial consultation (over the phone or in person, whichever you prefer) to answer your questions.

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