Most Florida flips do not fail in the rehab. They fail in the forty-eight hours before the contract goes hard, when the buyer priced the renovation carefully and never pulled the permit history. Florida fix and flip due diligence looks different from due diligence in Ohio or Texas, because the things that cost money here are different: open permits that block a resale, code enforcement liens that run with the land, insurance that may not be available at any sane price, a flood ordinance that can force a full-code rebuild, and a contractor licensing scheme with real teeth.
What follows is the order a Florida file should be worked. Nothing here is legal advice. A Florida real estate attorney should review anything on this list that touches title, and the exit math is yours to run.
Pull the permit history before you pull comps
Every municipality and county building department in Florida keeps a permit record by address or parcel. Search it first, and search for three things.
Open or expired permits. A permit that was issued and never finaled stays open. When you go to resell, the title company will usually catch it, the buyer’s lender may balk, and the fix is often not a phone call — it can mean re-inspection, bringing old work to current Florida Building Code, or demolishing and redoing it under a new permit. Some jurisdictions will allow a permit to be closed by affidavit; many will not. Budget for the worst version until the building department tells you otherwise.
Unpermitted work. Added bathrooms, converted garages, enclosed Florida rooms, carports turned into bedrooms, and detached “offices” are the usual suspects. An unpermitted enclosure often has no tie-downs, no impact glazing, and no engineered connection path, which means it has to come back out or be re-engineered. Compare the building department’s square footage to the property appraiser’s square footage to what you walked. Three different figures is a signal.
Age of the big systems. Roof, electrical panel, and plumbing supply lines drive both rehab cost and insurability. On a house from the cast-iron plumbing era, a corroded drain line under the slab is a realistic possibility. On an older house generally, an obsolete or recalled electrical panel is common. Neither shows up in a walkthrough.
Run the lien and encumbrance search wide
A title commitment is necessary but not sufficient on a distressed Florida property. Order it, then look past it.
- Code enforcement liens. Under Chapter 162 of the Florida Statutes, a local code board can impose daily running fines that are recorded as liens against the property. A small violation left open for two years can produce a balance that dwarfs the rehab budget. Some cities will mitigate the fine once the violation is cured and the property changes hands; some will not, and the policy varies by municipality. Call the code enforcement office and ask about their mitigation process before you commit.
- Municipal utility and special assessment balances. Unpaid water and sewer, demolition and lot-clearing charges, and paving assessments can attach to the parcel rather than to the person who ran them up.
- Construction liens. Chapter 713 of the Florida Statutes gives contractors, subcontractors, and material suppliers lien rights. If the last owner started a project and stopped paying, that exposure may still be live. When you start your own work, the same chapter governs you: record a notice of commencement where required, collect lien releases with every draw, and get a final contractor’s affidavit before the last payment.
- Association balances. For a condo, request the estoppel certificate under Fla. Stat. § 718.116(8); for an HOA, under § 720.30851. The estoppel is the association’s written statement of what is owed, and it is the only balance you should underwrite to.
Price the insurance before the inspection period ends
In Florida, insurability is a condition of the exit, not a line item. Get a real quote — builder’s risk or vacant dwelling for the hold, and a sample homeowner’s quote for your end buyer — during diligence.
Carriers will ask the age and condition of the roof, the water heater, the electrical panel, and the plumbing. A roof past its useful life can make the property uninsurable through standard carriers until it is replaced, which turns a cosmetic flip into a capital project. Order a four-point inspection on anything older, and a wind mitigation inspection on everything. Fla. Stat. § 627.711 requires insurers to offer premium discounts for verified wind-resistant features documented on a uniform mitigation form — roof deck attachment, secondary water resistance, opening protection. If you are replacing the roof anyway, specifying the features that earn those credits may meaningfully lower your buyer’s premium, and a lower premium widens the pool of people who can afford your house.
Check the flood zone, the elevation, and the substantial improvement rule
Pull the FEMA flood map for the parcel and, in a mapped flood zone, get or locate an elevation certificate. Then ask the local floodplain administrator a single question: how do they apply substantial improvement?
FEMA’s substantial improvement standard, which Florida communities adopt through local floodplain ordinances to stay in the National Flood Insurance Program, is triggered when the cost of improvement reaches half of the structure’s market value as FEMA defines it. Cross that line on an older house in a flood zone and the whole structure may have to be brought into compliance — including elevating it. Some jurisdictions count permits cumulatively over a period of years, which means the prior owner’s work can push your project over the threshold. This is the single largest unpriced risk in coastal and low-lying Florida flips, and the answer is free: ask the floodplain administrator in writing. FEMA’s floodplain management guidance explains the federal standard, but your local ordinance controls.
Verify the contractor, not just the bid
Florida licenses construction trades under Chapter 489 of the Florida Statutes, through the Department of Business and Professional Regulation. Before you sign a contract, verify the license number, the status, the exact scope it covers, and whether it is a state certified license or a county registered one — a registered license is only good in the jurisdictions where it is registered. DBPR’s license search is public and takes two minutes.
Then verify general liability and workers’ compensation directly with the insurance agent named on the certificate, not with the contractor. An expired certificate is a common way an investor ends up personally exposed on a jobsite injury.
Using an unlicensed contractor is not a shortcut. Fla. Stat. § 489.128 makes contracts with an unlicensed contractor unenforceable by that contractor, which sounds like it favors you until you realize it means no bond, no recourse, no warranty, and a permit you cannot pull. Pulling an owner-builder permit to cover someone else’s unlicensed work carries its own exposure under Chapter 489.
Condo and townhouse flips: read the association’s file
If the unit is in a building three stories or taller, ask whether a milestone inspection has been performed under Fla. Stat. § 553.899 and what it found. Then ask for the structural integrity reserve study required under Fla. Stat. § 718.112(2)(g) and the association’s reserve funding plan. A phase two milestone finding or an underfunded reserve study usually means a special assessment is coming, and a pending assessment of unknown size is very hard to sell into. Request the last twelve months of board minutes. That is where assessments appear before they appear in an estoppel.
Underwrite the exit, including the cost of money
Your buyer’s financing cost is your holding risk. Labor markets have stayed firmer than many forecasters expected — Realtor.com Research reported that October payrolls rose by 165,000, roughly double expectations, with upward revisions adding 84,000 jobs across the two prior months, while nominal wage growth of 3.1% still lagged inflation. Mortgage News Daily noted that bond yields barely budged after that print, which is a reminder that rate direction does not follow headline employment data in a straight line.
The practical takeaway for a flipper: do not underwrite a renovation on the assumption that rates will be lower when you list. Build the project so it clears at today’s cost of money, and treat any improvement as upside.
A short version of the checklist
- Building department permit history — open, expired, and missing permits.
- Property appraiser record versus measured square footage.
- Title commitment plus a direct call to code enforcement and utilities.
- Estoppel certificate for any association, plus a year of board minutes.
- Four-point and wind mitigation inspections, and a written insurance quote.
- FEMA flood zone, elevation certificate, and a floodplain administrator’s answer on substantial improvement.
- DBPR license verification, plus insurance certificates confirmed with the agent.
- Sewer scope on any older house; moisture and WDO inspection everywhere.
- Your own seller disclosure plan — Florida sellers have a duty to disclose known material defects that are not readily observable, and an attorney should tell you how that applies to your project.
Caliber Trust has been buying Florida houses directly since 2016, and we source off-market inventory for investors through deals.zylow.net. We work alongside agents and attorneys rather than around them — if you have a listing agent or your own counsel on a deal, that is not a conflict. You can see what we do or get in touch if you want a second read on a specific Florida property.