Fears real estate crisis is spreading beyond Florida as residents in Western city see condo fees skyrocket

Condo residents in Utah have been left blindsided by a huge rise in fees, which could see monthly payments more than double for some. 

Homeowners in Bountiful, which is less than half an hour away from Salt Lake City, received a notice that their monthly homeowners association (HOA) fees could soon rise to more than $800. 

This hike is largely due to an increase in insurance costs, the residents at Orchard Corners Condominiums were told. 

'Rising costs of labor, supplies, contracts, utilities, and a significant increase in insurance -from $17,000 to $108,000 - have created financial challenges that require immediate attention,' the HOA notice states. 

Now, panicked residents are worrying about how they will come up with the cash - and what this could mean for the future. 

'It's going to be really difficult for us to move when the listing's going to say that we have an $800 HOA,' resident Emily Horne told KSL. 'I feel stuck,' her husband Douglas added. 

These residents join hordes of condo owners who are facing a perfect storm of rising fees and insurance costs, which is forcing many to try and flee. 

While these issues have largely been concentrated to Florida and parts of Texas, the plight of these residents highlights an expanding real estate crisis. 

Emily and Douglas Horne bought their condo almost four years ago, the couple told KSL, and they are currently paying $385 a month in HOA fees. 

The suggested new sum of $800 is more than to two-thirds of their mortgage payment, Douglas said.  

The old insurance policy for the condo community was recently canceled, according to an August notice obtained by the outlet. 

Residents said the policy was canceled after one of the units caught fire and needed repairs. 

'I do think it is pretty ridiculous that we all have to pay for that one incident,' said Kelsey Hunziker, who has lived in the community since 2020. 

As an alternative to the $800 a month payment, the HOA board has also suggested a smaller 17 percent increase in monthly fees - plus a $3,000 lump sum payment.  

Calvin Barnett, another homeowner, said he and his family have saved up nearly $3,000, but they were planning on saving it for expenses for a new baby girl who is due in January. 

For Hunziker, it is 'horrible timing' ahead of the holidays.  

'I don't have much of my savings left right now,' she told the outlet. 'It's very rough.'

It comes as insurance costs are skyrocketing across the country, as natural disasters become increasingly common and insurers flee the most at-risk areas. 

While Utah is less at risk of some extreme weather events as states like Florida and Texas, it still saw homeowners insurance rates rise by 20 percent last year, according to S&P Global. 

In Florida, in particular, rising HOA fees and insurance costs, devastating natural disasters and new regulations are pushing the real estate market into a downward spiral.  

Home sales in five major cities have plummeted amid a snowballing crisis.

Fort Lauderdale, a city on Florida's east coast, saw pending sales drop 15.2 percent year over year during a four week period ending on November 10, according to a Redfin analysis.

Some condo owners are listing their properties for 40 percent cheaper than they are worth just to unload them. 

And in Miami, residents in two condo buildings are in uproar after being served a huge $21 million special assessment bill for repairs - just 16 years after construction. 

Some residents in the Brickell buildings face individual payments of more than $40,000, leaving them feeling blindsided and financially overwhelmed, and some are even considering selling up as a result.