How do you read the developer's estimated budget for a new Miami condo?

The number quoted at the gallery comes from a document, the developer's estimated operating budget, which chapter 718 of the Florida Statutes requires in the prospectus delivered before the fifteen day rescission period on a developer sale. It is an estimate, prepared before the building has a staff, an insurance policy or a utility bill, and it is the only version of the association's cost a buyer will see before closing. A buyer reads it for four things: the share of the whole that the chosen home carries, the lines that are set by contract against the lines that are guesses, the reserves and whether they are funded as the law now requires, and the developer's guarantee of assessments, if any, with the date it ends. The budget is not a promise. It is the developer's best case, and the first owner-elected board rewrites it.

Every condominium home carries a percentage of the common expenses, set in the declaration, usually by floor area or by value, and never changed without the vote the documents require. The monthly fee quoted for a line is that percentage applied to the total budget. Find the percentage for the line you want in the declaration's schedule, multiply it against the budget's total, and compare the result with the gallery's quote; a mismatch is the first question. Then read whether the home's percentage includes a share of a hotel's or a commercial unit's costs, because in a branded tower the shared facilities agreement can push cost through the association. Read Miami HOA fees and the condominium documents in five sections.

A budget has two kinds of lines. Contract lines, which the developer has already signed: the management agreement, the licence fee to a brand, a bulk cable or internet contract, an elevator maintenance agreement, a valet or security contractor. Ask for the contracts behind them and their terms, because a developer may sign long contracts before turnover that the owners inherit. Guess lines, which nobody has paid yet: insurance, electricity for common areas, water, payroll for a staff not yet hired, repairs on a building not yet built. Insurance is the line that has moved most in Florida in recent years and the one most often estimated low; ask for the insurance estimate's source and date, and whether a quote was obtained. Read Miami condo insurance, what it costs to own a condo in Miami each year and the building page on the association budget line by line at Waldorf Astoria.

Reserves are the budget's savings for the roof, the paint, the paving and, under the amendments that followed the 2021 collapse in Surfside, the structural items a Structural Integrity Reserve Study identifies for buildings of three stories or more. The study and the milestone inspection are the association's obligations, and the first budgets of a new building set the reserve lines before either exists. Read the reserve schedule for the items named, the useful life assumed for each and the annual contribution, and ask whether the developer's budget funds reserves fully or relies on a waiver that owners may no longer vote for on structural items. A budget with thin reserves is a budget with an assessment inside it. Read milestone inspections and reserves, what a beach building reserve study tells you and milestone inspections and reserves at Six Fisher Island.

Chapter 718 lets a developer guarantee that assessments will not exceed a stated amount for a stated period, in exchange for being excused from paying assessments on its unsold units while it funds any shortfall. The prospectus says whether a guarantee exists, the amount and the period. For a buyer that means two dates: the day the guarantee ends, after which the owners carry the real cost, and turnover, when the owners elect the board that will see the real bills. Ask whether the guarantee covers reserves, whether it can be extended by the developer alone, and what the budget looks like in the first year after it ends. Read when the developer hands a Florida condo association to its owners and the first year of owning a Miami condo.

In a branded residence the budget carries lines an unbranded tower does not: the licence fee, the operator's management fee, the shared facilities charge, and sometimes a staff standard the brand sets. Waldorf Astoria Residences Miami publishes Hilton managing the property under licence; Kempinski Residences publishes daily management by Kempinski Group with no hotel on the site; Delano publishes Accor benefits subject to an annual benefits fee. Where a club comes with the deed, as at Six Fisher Island, its dues sit outside the association's budget entirely and are a second budget to read. Ask what the brand charges the association, for how long, and who may end the arrangement. Read what a brand actually does in a Miami branded residence, brand licensing terms at Kempinski and club membership obligations at Six Fisher Island.

Three things, as mechanics rather than advice. Compare the fee per square foot against the other buildings on the shortlist on the same basis, because a low fee with no reserves and a high fee with full reserves are not the same product. Ask for the budget's revision date and whether a later version exists, since budgets are revised between launch and closing and the rescission right attaches to material changes. And keep the version delivered at contract in the ownership file, so that the first owner-elected board, and the buyer, can see what was promised. Read documents before closing on a new Miami condo and the ownership file for a Downtown Miami branded condo. The desk reads the estimated budget line by line with the buyer and asks the developer for the contracts behind it.