What is CDD?
CDD stands for Community Development District. Builders take out bonds for a period of time such as 10, 20 or more years to finance the infrastructure for a community. This allows roads to be built, sewer, electric and gas lines lines to be run, drainage and often common areas or amenities to be built.
By taking out a bond the builders can offer more affordable home prices with residents paying the bond back over a long period of time.
This CDD fee is collected annually with your county real estate taxes and can be found itemized on local property appraiser web sites.
When we are searching for your dream home this is one of the costs we pay attention to. Often it's an affordable cost and the community is worth living in. We'll always be careful to add the HOA, taxes, insurance costs along with any CDDs while we consider an offer on any home.
Two things to be aware of:
- The amount due annually on most CDD bonds won't change, however if the overall number of residents in a community decreases, the set amount is then re-divided among the remaining residents. If that occurs each resident's annual CDD amount could increase. Or it can go in the opposite direction. If additional homes are added to an area, or vacant existing homes are purchased, the total due is divided equally and the annual amount could decrease.
- When buying in a CDD community we can determine the length of the bond and how long it's already been in place. This would give foresight to a household expense decreasing. We would also determine if this particular CDD has a two part bond where once the bond is paid in full, that portion is no longer due, but a maintenance amount remains.
A CDD fee is just one of the expenses we can consider carefully while looking for your next dream home.