Key facts
- The Florida Association of Mortgage Professionals (FAMP) is advocating for two key initiatives to address Florida's affordability crisis: a property tax amendment and changes to condo financing rules.
- FAMP supports a ballot measure to phase in higher homestead exemptions, aiming to eventually eliminate property taxes on a portion of primary residences, with a five-year residency requirement for new arrivals.
- The Federal Housing Finance Agency (FHFA) has ended the 'limited review' process for condos nationwide and will increase required reserves for condo associations from 10% to 15% starting January 1, 2027.
- FAMP warns that these FHFA changes could push many condos out of the conforming loan market, leading to higher down payments and costs for borrowers.
- FAMP is lobbying for an extension of the limited review process and a delay of the reserve requirement increase to 2028, while also seeking FHA approval for more Florida condo projects.
Florida's growing popularity as a destination for new residents, particularly from states like New York, has intensified affordability challenges, driving up home prices and associated costs. In response, the Florida Association of Mortgage Professionals (FAMP) is focusing its advocacy on two key areas: property taxes and condo financing rules.
FAMP President Orlando Diaz highlighted that while interest rates and housing prices are difficult to legislate, insurance and taxes are within the government's purview. The association is backing a November ballot amendment aimed at eventually eliminating property taxes on a portion of primary residences through phased-in homestead exemptions. This measure includes a five-year residency requirement for new arrivals to mitigate rapid migration-driven price increases and protect essential services like education.
On the federal policy front, FAMP is concerned about the FHFA's decision to eliminate the 'limited review' process for condos nationwide and increase the required reserves for condo associations from 10% to 15% by January 1, 2027. Previously, Florida had a separate, stricter rule, but FAMP's lobbying efforts led to its removal, aligning Florida with national standards. However, Diaz expressed that the FHFA's decision to remove limited review altogether, rather than aligning Florida with other states, was a significant setback.
Diaz warned that the combination of higher reserve requirements and the removal of limited review could force many condos out of the conforming loan market, pushing borrowers into non-QM loans with higher down payments and interest rates. This, coupled with existing reforms that already increased reserves for many associations post-Surfside collapse, could lead to distressed sales as fixed-income owners struggle to meet new requirements.
FAMP is collaborating with other industry groups, including the National Association of Mortgage Brokers and the National Association of Realtors, to lobby for an extension of the limited review process by six to eight months and a delay of the 15% reserve requirement to 2028. Diaz estimates the chances of success at 50-50. The group is also working to increase FHA's involvement in financing Florida condos, as FHA loans are crucial for first-time buyers. FAMP is also coordinating with U.S. Rep. Byron Donalds on housing initiatives.