A story that’s just coming to light in the Miami area seems to indicate that some of the excessively high application fees at Miami area condos are illegal. An article by the Miami Herald titled South Florida condo boards rip off consumers with high application fees has all the details.
Nicholas Nehamas writes, “Condo associations across South Florida are ripping off consumers with high application fees in violation of state law, a Miami Herald investigation has found. Associations are allowed to charge people applying to buy or rent a unit a maximum of $100 per person. The nonrefundable fees cover the costs of interviews, background and credit checks. But many buildings gouge tenants and buyers with fees anywhere between $125 and $625, according to lease and purchase applications reviewed by the Herald.
Some associations also tack on moving-in and other charges that run into the hundreds of dollars. At a few condos that allow pets, even residents’ furry friends have to cough up fees of $100 or more. In Miami-Dade County, nearly half of condo listings show application fees exceeding $100, from fancy high-rises in Miami Beach to run-of-the-mill units in Kendall, according to a Herald analysis of a database used by Realtors. The problem exists in Broward County too but is less widespread.
All in all, the high fees could lead to class-action lawsuits against associations, attorneys say. “State law seems to pretty clearly prohibit fees in excess of $100,” said Jason Kellogg, a Miami attorney who specializes in condo association law. “This sounds like a major racket. … The cost of owning or renting a condo in South Florida is expensive enough without associations fleecing residents with illegal fees.”
The revelation follows a series of reports in El Nuevo Herald documenting corruption at South Florida condo associations, including rigged elections and contracts awarded without fair bidding. Illegal fees are another reminder that South Florida’s poor and middle class can’t keep up in a real-estate market distorted by out-of-town cash, said Ali Bustamante, a professor at Florida International University.
“High application fees are potentially discriminatory by crowding out low-income and low-middle-income renters who can’t afford to put down $300 fees,” he said. “It’s a huge foot on the scale.” As developers build luxury high-rises at the expense of middle-market housing, rents across South Florida have skyrocketed. The region is now one of the nation’s least affordable places to buy or rent, although a new push for downtown rental buildings could help out.”
To avoid being charged illegal fees and ensure your real estate transaction benefits you as much as it can, contact the Law Offices of Gilbert and Smallman. We have a long track record with real estate law, we offer consultations 24 hours a day, 7 days a week, and we will fight to protect your interests.
