Helpful information for those who have investment properties: CLARIFICATIONS FROM FHA OF ITS POSITION ON LEASING RESTRICTIONS IN FLORIDA CONDOS

Allowable Leasing Restrictions

The association can

• Restrict total number of units that can be rented at any given time
• Restrict the total percentage of units that may be leased at any given time
• Create a hardship clause for exception to the first two above
• Require that the Board be provided with a copy of the lease
• Require that the lease must be in writing
• Request the names of the tenants
• Require that the lease conforms to the legal governing documents of the association
• Set minimum and maximum lease periods
• Require unit owner to check the Registered Sex Offenders list
• Require rent to be assigned to association if the unit owner is delinquent in the payment of his/her common charges
• Provide corporate leasing restrictions
• Require Board review of lease [May not require approval of lease]
• Require that the lease be on a specific form
  Non-allowable Leasing Restrictions
  The association cannot

• Outright restrict leasing of all units (at least one unit in the condominium must be allowed to be leased) [**See Note below]
• Require that the unit owner own the unit for a period of time prior to being allowed to lease the unit
• Require Board/HOA approval of lease
• Require Board/HOA approval of modifications to, alterations of, amendments to or extensions of lease
• Be granted automatic power of attorney by the unit owner upon purchase of a unit (If the legal documents grant irrevocable POA to the association simply by the unit owner accepting the deed, the condominium is ineligible for FHA condominium project approval.(
• Restrict a unit owner’s ability to lease his/her unit if he/she is delinquent in the payment of common charges
• Require potential tenants to sit with the Board
• Require credit references
• Require criminal background checks (except for Registered Sex Offenders list)
• Require Board/HOA approval of tenant
• Have the power to void leases (leases cannot be voidable by a third party)
• Allow transient leasing
• Allow accommodations typically associated with a hotel, such as maid or front desk service.
  **NOTE: There are two exceptions where an association can outright restrict leasing: age-restricted communities and condominiums where 100% of the units are under Affordable Housing restriction.
  [For information on the background of why certain restrictions are not allowed, you can follow THIS LINK to an article about 24CFR203.41.]  From http://readysetloan.com/fha-clarifies-its-position-on-leasing-restrictions-in-condominiums/ Written by Eric Boucher, The FHA/VA Condo Project Approval Guy (ReadySetLoan Condo Team LLC)

PROPERTY PRICES IN PALM BEACH CONTINUE TO SOAR FOR BOTH HOUSES AND CONDOS

According to Attorney Les Evans, Managing Partner of Leslie Evans and Associates, a Palm Beach law firm, “People have no other place as attractive to put their money.”  His quarterly Evans report tells the story.

The median price for a single family home, he says, totaled $ 3.375MM in 2Q-2015, up 13.4% from $2.97MM the previous year.  The biggest sale in the first six months of 2015 was  to hedge fund star Paul Tudor Jones, 1300 South Ocean Boulevard, for $71.2MM. Built in 1923 on 11+ acres, the property has 7 bedrooms, 18 full bathrooms.  Previous sale in October 2014 was for $11,520,000.


His popular Evans Report, which details quarterly sales of homes in Palm Beach, shows that the median price for a single-family home totaled $3.375 million in the second quarter, up 13.4 percent from $2.975 million a year earlier. Condos are up 23.1% from $540,000 a year ago to $665,000 in 2Q-2015.

Evans compared the S&P 500 Index climbing only 5.2% in the 12 months through June 30, and it plunged 11% from August 17 to August 25, making homes a more stable buy, not being subject to daily fluctuations.