Short answer: Florida Statute 718 governs Condominiums, while Florida Statute 720 governs Homeowners Associations (HOAs). The primary difference lies in ownership structure: 718 deals with shared ownership of a common entity, whereas 720 focuses on the restrictive covenants governing individual land parcels. For boards in Bay County and Northwest Florida, understanding which statute applies is critical for legal compliance and fiduciary duty.
Condominiums (FS 718) vs. HOAs (FS 720): The Fundamental Divide
In Northwest Florida, from the high-rises of Panama City Beach to the gated communities of Bay County, associations generally fall under one of two primary statutory frameworks. While both aim to maintain community standards and protect property values, their legal DNA is different.
Florida Statute 718 (The Condominium Act)
FS 718 is designed for communities where individuals own their unit and a percentage of the undivided interest in the common elements. This includes everything from the land beneath the building to the elevators and pools. Because the shared interest is so high, the regulatory requirements for reserves, financial reporting, and structural integrity (including the new milestone inspections) are significantly more stringent.
Florida Statute 720 (The Homeowners Association Act)
FS 720 governs associations where individuals own their land (the lot) and are subject to a set of covenants that restrict how that land is used. The association manages the common areas and enforces the rules. While still highly regulated, the financial and operational burden is often different from a condominium, particularly regarding the scale of shared infrastructure.
Comparison: FS 718 vs FS 720
| Feature | Condominiums (FS 718) | HOAs (FS 720) |
|---|---|---|
| Ownership | Unit + Undivided Interest in Common Elements | Individual Lot Ownership + Covenants |
| Governance | Board of Directors / Governing Docs | Board of Directors / Governing Docs |
| Reserves | Strict statutory requirements; mandatory reserve studies for many | Required by docs; statutory guidance exists but varies by HOA type |
| Compliance Focus | High: Structural Integrity, Milestone Inspections | Moderate to High: Architectural Review, Covenant Enforcement |
| Fiduciary Duty | High: Managing significant shared assets | High: Maintaining neighborhood standards |
Why the Distinction Matters for Bay County Boards
For boards in Bay County, misidentifying the applicable statute is not just a clerical error—it is a fiduciary risk. Applying HOA rules to a condominium or vice versa can lead to invalid fines, unenforceable rules, and potential lawsuits. Maxet specializes in transitioning associations from legacy management to a tech-driven, compliance-first model where these distinctions are hard-coded into the operational workflow.
Frequently Asked Questions
Can a community be both a Condo and an HOA?
Yes. Many high-end developments in Northwest Florida use a Master Association (FS 720) to manage overall amenities and a sub-association (FS 718) for the specific condominium buildings. This requires a complex coordination of two different legal frameworks.
Which statute takes precedence in a conflict?
Generally, the legal hierarchy is: Federal Law → State Statutes (718/720) → Local Ordinances → Governing Documents. If a governing document contradicts a state statute, the statute typically prevails.
How does this affect my reserve funding?
Condominiums under FS 718 generally face stricter mandates for reserve funding and structural reports. Boards must ensure their reserve studies are current and funding matches the anticipated lifecycle of the assets.
Ready to Modernize Your Association Management?
Managing the intersection of FS 718 and FS 720 requires more than just a manager—it requires a compliance architect. Maxet provides the tech-driven efficiency and recovery specialization needed to ensure your community stays compliant, solvent, and visually stunning.
Legal disclaimer: Maxet is a professional community association management firm providing business operational efficiency and administrative support. We are not a law firm, and the information provided in this article does not constitute legal advice or create an attorney-client relationship. For specific legal interpretation of Florida Statutes or governing documents, we strongly recommend consulting with a licensed attorney specializing in Florida community association law.