Glossary · Community Fees

CDD Bond

Florida Real Estate Glossary entry. Definition, examples, and how this term applies to NE Florida transactions.

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Definition
A Community Development District (CDD) bond is debt issued by a special-purpose government unit to fund infrastructure for a new community — roads, water systems, drainage, landscaping, community amenities. The bond is repaid over 20-30 years through annual assessments on each home in the district, typically $1,200-$2,400 per year per property in NE Florida master-planned communities like Nocatee, SilverLeaf, and Wildlight.

What a CDD actually is

A Community Development District is a special-purpose unit of local government created under Florida statute to finance and manage infrastructure within a specific community. The CDD is technically separate from the city or county government. It has the legal authority to issue tax-exempt bonds, levy assessments on property within its boundaries, and manage common-area infrastructure.

How CDD bonds work

When a developer plans a large master-planned community, they create a CDD to finance the up-front infrastructure costs (roads, drainage, water systems, common amenities, sometimes recreation facilities). The CDD issues municipal bonds to raise the capital. Bonds are typically 20-30 year obligations. Each lot or home in the district receives an annual assessment that contributes to the bond repayment. This assessment is in addition to property taxes and any HOA dues.

Typical NE Florida CDD costs

In Northeast Florida master-planned communities, CDD assessments typically range from $1,200 to $2,400 per year per property. Nocatee, SilverLeaf, Wildlight, eTown, Bartram Ranch, and Crosswater at Nocatee all carry CDD obligations in this range. The exact amount varies by community and individual lot — premium lots and larger homes often carry higher assessments.

Bond duration

Once a CDD bond is fully paid off, the assessment for that bond ends. However, many large communities issue multiple bonds across their development phases, so even if one bond ends, others may still be active. Always verify the remaining bond balance and expected payoff date for the specific lot before purchase.

The total cost no one tells you

Over 30 years, a typical NE Florida CDD assessment of $1,800 per year totals $54,000 in cumulative cost — meaningful in your home purchase decision but rarely disclosed prominently. Some communities advertise their amenities without explaining that you're paying for them via the bond. When comparing a master-planned community home to a comparable non-CDD home, factor the CDD assessment into your monthly carrying cost.

Common questions.

Is the CDD bond paid off when you sell the home?
No. The CDD bond stays with the property, not the owner. When you sell, the buyer assumes the remaining annual assessment. If the bond has not been paid off, the buyer continues making the annual payment. Some sellers choose to pay off the remaining bond balance at closing to make the property more attractive, but this is optional and rare.
How do I find out the CDD assessment for a specific home?
Check the county property appraiser's website for the specific parcel. CDD assessments appear on the property's tax record. You can also ask the listing agent for a copy of the most recent property tax bill, which itemizes the CDD assessment separately from regular property tax.
Are CDD assessments tax-deductible?
The interest portion of CDD bond assessments may be tax-deductible as property taxes if the assessment funds general public improvements (roads, drainage). The portion that funds private amenities (clubhouses, pools, recreation) typically is not deductible. Consult your tax advisor for your specific situation.
Are CDD bonds the same as HOA dues?
No. CDD bonds and HOA dues are separate. The CDD funds infrastructure development through bonds. The HOA covers ongoing community management, common-area maintenance, and association operations. Most master-planned NE Florida communities have both.
Which NE Florida communities have CDD bonds?
Most master-planned communities in St. Johns County and Nassau County carry CDD assessments. Nocatee, SilverLeaf, Wildlight, eTown, Bartram Ranch, Crosswater at Nocatee, Tributary, Trail Mark, and Aberdeen all have CDDs. Older established neighborhoods (Mandarin, Riverside, San Marco) typically do not.
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