Already battered by the twin financial crises of sky-high insurance costs and state-mandated requirements to fully fund reserves, homeowners associations of condominium complexes now face a new threat as they go into budgeting season.

As the glut of condos on the market grows and units that do move selling for far below recent prices, an increasing number of individual condominium owners are unwilling or unable to pay their full share of increasing maintenance fees and special assessments.

Some condo owners have even walked away from their units, leaving their HOA with the unenviable task of turning the electricity back on to prevent mold buildup. HOA boards of directors can assess non-paying condo owners maximum interest and penalties for missed fees and assessments, and eventually, the HOAs may recover their costs. But in the meantime, the HOA has to continue operating without the money. Beyond increasing allowances for bad debt, there is little HOAs can do to counter shortfalls in collections. Reliable statistics on how bad the situation is, either state-wide or in Vero Beach, are hard to come by. One of the largest property management firms in the area, Elliott Merrill, routinely refuses all comment. Another local firm, Keystone Property Management, which was recently sold to corporate interests, did not respond to a request for comment.

Many of the condo owners who have fallen behind in their payments have been unable to sell their units after several months of having their properties on the market.

“Our hands are hopelessly tied as far as those that do not pay and walk away,” said one Vero Beach HOA Board president. “Eventually we may get reimbursed at some level. We can set up an account for uncollectible debts, but in the end it’s up to those remaining to pay to keep the lights on, clean the pool, pay the insurance, etc.”

Since the budgeting process for calendar year 2026 has just started, no one knows for sure by how much maintenance fees or assessment will have to go up for remaining condo residents because of non-payments by some.

Mark Shea of Vero Beach, one of the leaders of the Treasure Coast Condominium Alliance (TCCA), a group of close to 20 condominium associations stretching from Indian River Shores in the north to Stuart in the south, blames the legislation passed in the wake of the 2021 collapse of the Champlain Towers condo complex in Surfside in South Florida for the present crisis.

Supposedly to prevent future such collapses, new state laws forced all buildings three stories or higher that are close to the water to undergo “milestone inspections” on structural safety and then make arrangements to fully fund reserves for repairs mandated by the inspections.

Shea said the well-intended safety legislation turned into a serious government over-reach, and wound up being no more than “a transfer of wealth, primarily from senior citizens (condo residents living on a fixed income) to the construction and banking industries.”

Shea noted that everyone in the construction industry, from licensed inspectors and contractors, as well as bankers who offer financing loans to strapped HOAs, has been making money on the backs of condominium owners hit hard by rising costs.

“Thousands of condo owners are handing their children’s inheritance over to construction companies or banks to finance the work required by the new laws,” Shea said, adding that he’d like to know how much lobbying was done and campaign contributions were made by the construction and banking industries to get the new state laws passed.

The TCCA is continuing to lobby in Tallahassee to get the new state condo laws totally repealed, or at least to get enforcement paused until further notice, but the legislature is adjourned and state senate and house committees won’t start meeting again until early next year.

Condo owners just walking away from their units is new phenomenon in the Vero Beach area.

“We just had our first person walk away,” said an HOA Board of Directors member. “They didn’t leave any information – who the mortgage holder is, or the attorney handling the situation. They even had the power turned off, so now we had to put it back on in the name of the association to reduce possible mold.

“Next is having our building superintendent make a weekly round to make sure there are no water leaks and no sewer gas is coming back into the building from the toilets, etc.,” he added. “We’ll place those charges against the unit and hopefully get reimbursed someday, but in the meantime, it’s a mess!”