Florida Milestone Inspection 2026: What Happens If Your Condo Fails

Florida condos 3+ stories and 30+ years old must pass a milestone structural inspection. Most deadlines have already passed. Failures trigger mandatory repairs, special assessments of $134,000 to $400,000 per unit, and potential financing loss.

On June 24, 2021, Champlain Towers South in Surfside collapsed at 1:22 a.m., killing 98 people. The 12-story beachfront condo was built in 1981. Structural problems had been identified in a 2018 report. A $15 million remediation program had been approved by the board. The work had not started.

Florida's response was SB 4-D, signed May 26, 2022, creating mandatory milestone structural inspections for aging condo and co-op buildings. The law has since been amended by SB 154 (2023) and HB 913 (2025). An estimated 900,000 Florida condo units in buildings over 30 years old are subject to these requirements.

If you're buying a Florida condo, the building's milestone inspection status is now one of the most important data points in your due diligence.

The Deadlines: Most Buildings Are Already Past Due

The milestone inspection deadlines were Dec 31, 2024 and Dec 31, 2025. Most eligible buildings should have completed inspections already.

Under Florida Statute 553.899, milestone inspections apply to condo and co-op buildings that are 3 or more habitable stories tall. The deadlines are based on building age:

Local enforcement agencies may require buildings to inspect at 25 years instead of 30 based on environmental conditions such as proximity to salt water. This is not automatic statewide. It is entirely at the discretion of the local jurisdiction.

A common misconception is that Dec 31, 2026 is the milestone inspection deadline. It is not. Dec 31, 2026 is the outer limit for completing a Structural Integrity Reserve Study (SIRS) when done simultaneously with a milestone inspection. The inspection deadlines themselves have already passed for most eligible buildings.

Phase 1 vs Phase 2: What Each Inspection Covers

Phase 1 is a visual examination by a licensed engineer. Phase 2 is triggered only if substantial structural deterioration is found.

Phase 1 is a comprehensive visual examination of both habitable and nonhabitable areas, performed by a licensed architect or engineer. It focuses on major structural components: foundation, load-bearing walls, columns, floors, and roof structure. The inspector submits a report to the local building official.

If Phase 1 finds no substantial structural deterioration, Phase 2 is not required. The building passes.

Phase 2 is triggered when Phase 1 identifies "substantial structural deterioration". The statute defines this as structural distress that negatively affects the building's general structural condition and integrity. Surface imperfections like minor cracks or peeling do not qualify unless they indicate deeper problems.

Phase 2 involves destructive and non-destructive testing to confirm the extent of damage. The inspector must recommend a program for assessing and repairing the damaged portions. Under HB 913 (2025), repairs must commence within 365 days of receiving the Phase 2 report.

Phase 1 inspections cost $8,000 to $25,000 for small buildings (10-30 units), $20,000 to $60,000 for mid-size buildings (30-100 units), and $50,000 to $150,000+ for large high-rises. Phase 2, if triggered, runs $40,000 to $250,000+ depending on the scope of deterioration.

What Happens When a Building Fails

Phase 2 findings trigger mandatory repairs within 365 days, special assessments of $134K-$400K per unit, and potential vacate orders.

When Phase 2 confirms structural deterioration, the consequences cascade. The board must fund and begin repairs within 365 days. Reserve waivers for structural components are no longer permitted under Florida law. That leaves two funding options: raise monthly assessments or levy a special assessment.

The numbers are severe. At Palm Bay Yacht Club in Miami (235 units, 27 stories), the total assessment reached $46 million (up to $175,000 per unit). At Cricket Club in North Miami, a bay-front building built in 1975, the assessment was $30 million (roughly $134,000 per unit). Mediterranean Village in Aventura saw assessments reported up to $400,000 per unit.

If an association fails to begin repairs, the local enforcement agency must review whether the building is unsafe for human occupancy. That can lead to a vacate order forcing residents out. Board members who willfully fail to arrange inspections may face personal liability for breach of fiduciary duty under Section 718.111.

The SIRS Connection: Reserve Waivers Are Gone

Florida banned reserve waivers for eight structural components as of Jan 1, 2026. Boards can no longer vote to underfund critical repairs.

For decades, Florida condo boards routinely voted to waive or reduce reserve funding, keeping monthly HOA fees artificially low. That option is gone for structural components.

Under FL Stat. 718.112(2)(g), associations can no longer waive reserves for the eight mandatory SIRS components: roof, load-bearing walls and primary structural members, fire protection, plumbing, electrical, waterproofing, windows and exterior doors, and any other item with a deferred maintenance or replacement cost exceeding $10,000. The ban on waiving reserves for these components took effect for budgets adopted after December 31, 2024. Full reserve funding must begin by January 1, 2026.

Non-structural components (landscaping, pool equipment, clubhouse furnishings) can still be waived with a majority member vote. But the big-ticket items that drive special assessments are now locked in.

One concession: associations may suspend reserve funding for up to two years after a milestone inspection to redirect funds toward urgent repairs identified in the report.

Impact on Financing and Resale

Buildings without completed inspections risk Fannie Mae's unavailable list. Roughly 5,000 condos are already blocked from conventional financing.

Fannie Mae's unavailable list has grown from a few hundred condos before 2021 to roughly 5,000 in 2025. In Miami-Dade, Broward, and Palm Beach counties alone, 696 buildings are affected. The top two reasons: insufficient master insurance and critical repair or inspection failures. When a condo lands on this list, owners cannot sell using conventional mortgages.

Fannie Mae has also retired its Limited Review option for condo loans. All purchases now require Full Review, which means lenders need the HOA budget, financial statements, reserve study, delinquency data, and insurance documents. More document requests mean more opportunities for underwriters to flag problems.

The market is responding. Florida condo inventory is up 38% year-over-year with 13.2 months of supply. Pending condo sales dropped 21% statewide. Condo values in major Florida markets are down 4.7% to 9.9%.

What Buyers Should Check Before Closing

Six due diligence questions that separate a sound Florida condo purchase from a six-figure special assessment surprise after closing.

• Has the milestone inspection been completed? Most eligible buildings should have finished by now. If not, the building is non-compliant and you have no visibility into structural condition.
• Was Phase 2 triggered? What were the findings? Request the full report. Phase 2 findings mean mandatory repairs within 365 days and likely special assessments.
• Is the SIRS current? The Structural Integrity Reserve Study must reflect the milestone inspection findings and include a baseline funding plan where reserves never fall below zero.
• Are any special assessments pending or under discussion? Check the last 12 months of board meeting minutes for hints of upcoming costs.
• Is the building on Fannie Mae's unavailable list? Check the Fannie Mae Condo Status Finder. If it's on the list, conventional financing is unavailable.
• What is the building's insurance status? Inadequate master insurance is the number one reason condos land on the unavailable list. Ask for the current policy, coverage amount, and recent premium history.

Extend your document review period beyond the typical 3 days. For out-of-area purchases, consider hiring a local engineer to interpret milestone findings and a condo attorney to review the financial documents.