Since August 3, 2026, most conventional loans on an established condo have required the lender to underwrite the building as well as the buyer. Fannie Mae retired its Limited Review process for loan applications dated on or after that day. Freddie Mac retired its Streamlined Review on the same schedule, as Florida Realtors reported. Established projects now generally go through a Full Review unless they qualify for a waiver. In practice, two units with the same view, the same finishes and the same asking price can be very different purchases if one association's budget passes that review and the other's doesn't.
Downtown St. Petersburg has 1970s bayfront towers within walking distance of high-rises that began closing less than a year ago. The difference between them now shows up in the lender's file as much as in the listing photos.
The Cash Share Points to the Building
The September 2026 report from the Pinellas REALTOR Organization combines townhouses and condos countywide, so it covers more than downtown. Even so, its pattern is hard to miss.
| Pinellas townhouses and condos | September 2026 | September 2025 |
|---|---|---|
| Closed sales | 495 | 437 |
| Paid in cash | 304 | 246 |
| Median sale price | $246,750 | $238,000 |
| Average sale price | $378,394 | $332,753 |
| Median time to contract | 61 days | 77 days |
| Months supply of inventory | 6.5 | 7.9 |
About 61% of September's closings were all cash, and cash sales rose 23.6% from a year earlier. The median price rose 3.7% while the average jumped 13.7%. When the average climbs almost four times as fast as the median, more of the dollar volume is concentrated at the top of the market. Together the two numbers describe a split market, where buyers who skip the lender's project review make up a growing share of closings.
These figures were released October 16. The next monthly release is set for November 16, so September remains the most recent full month as this post publishes. The data doesn't show how much of the cash share comes from financing rules and how much comes from who is buying. The rules explain why the question matters.
What a Full Review Reads
Fannie Mae's Full Review requires the lender to evaluate the project's eligibility along with the borrower's loan. As Florida Realtors explained in May, that includes the association's budget, reserves, insurance and financial condition, and whether the property meets agency standards.
Under the Fannie Mae Selling Guide, a project is ineligible if it needs critical repairs, and the guide defines critical repairs broadly. They include:
- Material deficiencies that could lead to failure of a critical system within a year
- Water intrusion or advanced deterioration
- Failure of a mandatory structural safety inspection
- Unfunded repairs of more than $10,000 per unit due within 12 months
If a structural or mechanical inspection completed within the last three years identifies unaddressed critical repairs, the building stays ineligible until the work is finished and documented, usually with an engineer's report. A failed local inspection or an incomplete recertification also counts against eligibility. Freddie Mac's guide applies the same logic. It bars loans in projects that need critical repairs and requires lenders to review current or planned assessments to see whether they fund that work.
This is where a special assessment matters. Fannie Mae says an assessment isn't automatically disqualifying, but a project remains ineligible while the related critical repairs are incomplete. That holds even when an assessment or an association loan is already paying for them. An association that has voted to fix its garage concrete has a plan. Until the work is done, though, a lender may still decline to underwrite the building.
Florida's Reserve Math and Fannie Mae's Differ
Florida's post-Surfside rules require a Structural Integrity Reserve Study, or SIRS, at least every 10 years for residential condo buildings of three or more habitable stories. The study covers eight elements, including the roof, structural systems, plumbing, electrical, waterproofing, and windows and exterior doors. According to the Florida Department of Business and Professional Regulation, the SIRS sets its yearly savings schedule using a baseline funding plan, which keeps the reserve account from ever dropping to zero.
Fannie Mae's March 2026 lender letter, LL-2026-03, points in a different direction. If a building doesn't budget enough for replacement reserves and the lender relies on a reserve study instead, the lender must confirm that the budget includes the study's highest recommended reserve allocation. The letter adds that lenders may no longer use the baseline funding method, which it describes as the option that lets the reserve balance approach zero without falling below it. That applies to loan applications dated on or after August 3, 2026.
That means an association can follow the funding plan in its Florida SIRS and still fall short on that particular path to Fannie Mae eligibility. The gap only matters for buildings whose regular budget doesn't already meet the agency's reserve minimum, which is why the budget line deserves close attention.
Two Deadlines, Four Days Apart
| Date | Rule | Source |
|---|---|---|
| Aug. 3, 2026 | Fannie Mae Limited Review retired; baseline funding no longer accepted for reserve studies | Fannie Mae LL-2026-03 |
| Dec. 31, 2026 | Deadline for a SIRS completed together with a milestone inspection | Florida DBPR |
| Jan. 4, 2027 | Fannie Mae Full Review minimum reserve allocation rises from 10% to 15% of annual budgeted assessment income | Fannie Mae LL-2026-03 |
Most existing associations had a December 31, 2025 SIRS deadline. The exception applies to buildings with a milestone inspection due by the end of 2026, which may complete both together, no later than December 31, 2026. Florida's milestone inspection applies to condo buildings of three or more habitable stories once they reach 30 years from their certificate of occupancy, or 25 if the local enforcement agency sets that threshold, and every 10 years after that. Associations that voted to waive or reduce SIRS reserves could do so only for budgets adopted by December 31, 2024. Funding under the study had to begin January 1, 2026.
Four days after Florida's last SIRS deadline, the lending threshold goes up. Under Fannie Mae's Full Review, the budget must already put at least 10% of assessment income into replacement reserves, and special-assessment income can't count toward that. For applications dated on or after January 4, 2027, the minimum becomes 15%. A buyer who goes under contract in December could close under different reserve rules than a buyer who applies in January. The difference depends on the application date, not the closing date.
One part of the change works in Florida's favor. Fannie Mae's letter says retiring Limited Review effectively ends the agency's remaining geographic restrictions on Florida. Florida Realtors also reports that Fannie Mae is ending its requirement that new or newly converted Florida condo projects with attached units go through its Project Eligibility Review Service. Florida buildings now get the same Full Review as projects elsewhere. Whether a building passes still comes down to its own budget and repair record.
Downtown's Towers Fall on Both Sides of the Milestone Clock
Downtown's skyline shows both ends of this. In 2023, the St. Pete Catalyst reported an estimated $45 million in needed repairs at Bayfront Tower. The 29-story, 250-unit building dates to 1975, and the listed issues included post-tension cables, metal framing, exterior stucco, garage concrete and the roof. The same report noted a $10 million renovation in 2014. Those figures are three years old and say nothing about the building's current eligibility. They do show the scale of work an older tower's reserve study is meant to plan for.
At the other end are towers that are decades from their first milestone inspection. Florida YIMBY reported in December 2025 that Art House, a 42-story, 244-residence Kolter Urban project, had received a temporary certificate of occupancy for floors 10 through 32 and was more than 85% sold. In February 2026, the Tampa Bay Business Journal reported construction complete and buyers closing, including a penthouse that sold for just under $6 million in early February. Red Apple Real Estate announced in December 2025 that The Residences at 400 Central had received a temporary certificate of occupancy for its first 25 floors and scheduled its first closings. The developer said most of the tower's 301 residences were sold.
Million-dollar closings in new towers help explain why the countywide average rose faster than the median. They're new-construction sales, though, and shouldn't be read as resale comparables for a 1970s building a few blocks away. In downtown, a building's age affects its financing as much as its finishes.
What This Means at the Contract Stage
In June 2025, the Tampa Bay Times reported that condo sales in the Tampa Bay metro were down 20% from the year before, compared with a 15% decline statewide. The paper also described buyers negotiating for sellers to pay pending assessments. The August 2026 changes give that negotiation a firmer basis. Budgets, reserve studies, recent inspection reports and any assessment votes are now the documents a lender reads, and Florida Realtors advises real estate professionals to flag condo documents and project eligibility early so financing isn't delayed.
For sellers, the same paperwork affects how many buyers can actually make an offer. A building with clean records and adequate reserves is open to cash buyers and conventionally financed buyers alike. A building with open critical repairs may, for now, be limited to buyers who can close without a Fannie Mae or Freddie Mac loan.
This post is general information, not legal, financial or lending advice. Please confirm how these rules apply to a specific building and loan with your lender, an attorney or the association's professionals.
FAQ
Does a special assessment make a condo unfinanceable? Not automatically. Fannie Mae requires the lender to determine whether the assessment pays for critical repairs, and the project stays ineligible until that work is complete.
Do these rules apply to every mortgage? These project-eligibility standards govern loans sold to Fannie Mae and Freddie Mac. Other loan types are a question for your lender.
Does the 15% reserve rule apply to my January application? Fannie Mae's LL-2026-03 ties it to Full Review loan applications dated on or after January 4, 2027.
If you're weighing a downtown condo and want to know whether a building's budget and inspection history can support the loan you plan to use before you fall for the view, Aaron Hoffman can help you request the right documents early and coordinate with your lender before deadlines start to bind. Let's Connect.
