Understanding CDD Fees: What You Need to Know as a Homebuyer in Florida
If you're considering purchasing a new home in Florida, you may have heard about CDD fees. So, what exactly are they? Let’s break it down.
What are CDD Fees?
CDD stands for Community Development District—an organization that helps develop land, provide infrastructure, maintain amenities, and enhance the quality of life in a community. Essentially, CDDs make it possible for homeowners to enjoy a higher standard of living through well-maintained community amenities, often found in neighborhoods with resort-style features.
Not all communities have CDD fees. You’ll generally find them in communities that offer amenities like pools, parks, and clubhouses. The fees help to offset the costs of developing and maintaining these amenities, as well as the infrastructure that supports the community. The benefit? Lower home purchase prices since the infrastructure costs are spread out over time.
What Do CDDs Provide?
When you pay CDD fees, you’re contributing to the development and upkeep of common areas and community amenities. These might include swimming pools, playgrounds, dog parks, or even a community center. Additionally, the CDD ensures that these amenities are maintained to a high standard, following guidelines set by the community and the CDD board.
One of the biggest perks of living in a CDD community is the aesthetic appeal and the variety of amenities you get to enjoy—often at a comparable price to non-CDD neighborhoods!
Understanding CDD Fees
CDD fees are typically made up of two parts:
Bond (or Debt): This covers the cost of infrastructure and amenities, usually spread out over 20 to 30 years. You can also choose to pay this off early.
Operations and Maintenance: This portion funds the upkeep of the community and its amenities, and it can fluctuate annually.
Both parts of the CDD fee are included in your property tax bill, which makes it easy if you're financing your home, as they’re usually handled through your mortgage escrow. So, no need to worry about separate payments!
How is a CDD Organized?
CDDs operate like local governments in Florida, with a Board of Supervisors overseeing the district’s policies. This board is made up of five members who work with a district administrator and legal counsel to ensure smooth operations, from managing amenities to handling engineering needs.
CDD vs. HOA: What’s the Difference?
In a CDD community, you may still have a homeowners association (HOA), but its role is different. While the CDD manages the amenities and common areas, the HOA primarily enforces community rules and architectural standards. This often means HOA fees in CDD communities are lower than in non-CDD communities, where the HOA manages everything.
Exploring New Home Communities in Florida
Now that you understand the basics of CDD fees and their benefits, you’ll be better equipped to weigh the costs and amenities when comparing CDD and non-CDD communities.
If you have any questions or want to explore CDD communities in Florida, feel free to reach out to me. I’d love to help you find your perfect home!
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