Florida Real Estate, Defined: CDD, HOA, COA and Master Association

Shop for a home in Winter Garden, Horizon West, Clermont or ChampionsGate and you will meet four acronyms before you finish the first listing: CDD, HOA, COA and master association. They sound alike, and they sit in different parts of Florida law. This Friday explainer in the Bella Trae Realty Florida Transaction How-To series gives you a plain definition of each one, so the paperwork makes sense when it arrives.

The CDD: A Local Unit of Government

A community development district is a local, special-purpose unit of government. Chapter 190 of the Florida Statutes creates it for a specific job: delivering community development services such as roads, drainage, water management and similar public facilities. A board of supervisors governs the district.

A CDD is a government body, so Florida law keeps it separate from an HOA. The HOA statute says so directly: the term "homeowners' association" does not include a community development district. Many newer Central Florida neighborhoods sit inside one, because developers use districts to finance infrastructure while the community is built.

Florida requires a disclosure on the initial sale of a home inside a district. Under Section 190.048, a contract for the first sale of a residential unit must carry a boldfaced notice that the district may levy taxes or assessments on the property. Those charges are in addition to county and other local taxes and assessments, and the district's governing board sets them annually. That notice applies to the first sale from the builder. On a resale, ask your agent and the title company whether the property sits in a district.

The HOA: Rules for a Neighborhood of Homes

A homeowners' association is a Florida corporation that operates a community of single-family homes, townhomes or villas. Chapter 720 defines it by three features. Membership is mandatory when you own a parcel in the community. Voting membership is made up of parcel owners. The association can charge assessments that may become a lien on the parcel if they go unpaid.

Two documents shape daily life in an HOA. The declaration of covenants is recorded in the county where the property sits and runs with the land. The articles of incorporation and bylaws cover how the association itself operates. Together, Florida calls them the governing documents. They cover things like paint colors, fences, parking, rental rules and what the association maintains.

The COA: Ownership Built Around Shared Building

COA is shorthand for a condominium association. In a condominium, you own your unit and share ownership of the common elements, such as hallways, roof, pool and grounds, with the other owners. Chapter 718, the Florida Condominium Act, defines the association as the entity that operates those common elements, with membership made up of unit owners and required as a condition of owning a unit.

The condo association's reach is usually wider than an HOA's, because the building itself is shared. The association typically maintains the structure and carries insurance on it, and the board of administration runs the budget. That is why condo buyers in Kissimmee, Davenport and Orlando hear so much about reserves and building rules. Our backbone posts cover those topics in order.

The Master Association: One Layer Above

"Master association" is a working term from the industry. It describes a larger association that oversees shared roads, entries, parks, amenity centers or other common property across a big community, while smaller sub-associations govern individual neighborhoods, villages or condo buildings within it. The term comes from the recorded documents for each community, so the exact powers vary from one development to the next.

In practice, this means a home can belong to more than one association. A Horizon West home might belong to a master association for the village amenities and a neighborhood association for its own street. Each can have its own governing documents, its own board and its own assessments. Ask the title company early which associations apply to the address.

How the Four Fit on One Property

Picture a new townhome in a master-planned Central Florida community. It could sit inside a CDD that financed the roads and ponds, belong to a neighborhood HOA that handles landscaping and exterior rules, and answer to a master association that runs the clubhouse. A condo unit in a resort-style community can add a COA on top of the master association and a CDD behind both.

A quick way to keep them straight:

• CDD: a unit of local government created under Chapter 190
• HOA: a private corporation of parcel owners under Chapter 720
• COA: a private association of condo unit owners under Chapter 718
• Master association: a higher-level association that oversees shared property for a larger community, defined by the recorded documents

When you review a listing, ask for the name of every one of these that applies, who to contact at each, and where each charge is billed.

Sort the Acronyms Before You Write an Offer

At Bella Trae Realty, we list every association and district that touches a property before you write an offer, so you know who you will answer to after closing. If you are buying or selling in Winter Garden, Windermere, Clermont, Ocoee or anywhere in Central Florida, contact Bella Trae Realty today and we will help you sort out the acronyms.

This post is general education, not legal, tax or lending advice. Confirm current figures and terms with a licensed Florida professional.

Up Next: On Monday, November 16, Transaction Step 22 covers HOA and condo document review and the Florida condo rider. On Wednesday, Step 23 looks at CDD bonds and assessments.