Thinking about a Gulf-front place in Destin but not sure if a standard condo or a condo-hotel is right for you? You want beach time, smart numbers, and a property that fits your lifestyle. In this guide, you will learn how these two options differ in ownership, rentals, financing, fees, taxes, and resale so you can choose with confidence. Let’s dive in.
What is a condo in Destin?
A residential condominium gives you individual ownership of your unit plus an undivided interest in the common areas. It is governed by a declaration, bylaws, budget, and rules under Florida’s Condominium Act. You typically control if and how you rent your unit within the association’s rental policy. Many associations allow short-term renting with registration or minimum lease terms.
What is a condo-hotel?
A condo-hotel is legally still a condominium, but it runs with hotel-style operations such as a front desk, reservations, housekeeping, and on-site management. Units are usually part of a centralized rental program where revenue is shared after management and operating fees. Owner use can be limited by blackout dates, minimums, and formal reservation processes. These buildings are often marketed as turnkey investment options because the operator handles bookings and guest services.
Ownership and rules: how they differ
Both property types rely on the declaration, bylaws, and rules to define your rights. In a condo-hotel, expect additional documents like a rental program agreement and a long-term management contract that outline owner use windows and hotel-style standards for housekeeping and guest services. Residential condos generally give you more discretion on rentals within HOA rules. Before you write an offer, plan to review the declaration, rental agreement, management contract, recent budgets, and association meeting minutes.
Rental income and management
In a condo-hotel, reservations and marketing are centralized, and income flows to owners after fees, taxes, and operating costs. You receive periodic statements that show gross revenue and net distributions. In a residential condo, you typically manage rentals yourself or hire a third-party manager and keep your gross rents after your chosen management fees. Condo-hotels may produce strong short-term performance due to branding and on-site services, but those services also increase costs and reduce flexibility.
Fees and operating costs
Condo-hotels often carry higher and more variable expenses tied to hotel operations such as housekeeping, linens, staffing, and marketing. Some fees are a percentage of gross rental revenue in addition to association assessments. Residential condo fees are more likely to be fixed monthly dues for common-area maintenance with occasional special assessments. Always compare budgets, reserve funding, and the fee structure that applies to owner use and rentals.
Financing and loan options in Destin
Financing can be the deciding factor. Many condo-hotels are considered non-warrantable by conventional investors, which limits access to typical conforming loans. Buyers often use larger down payments, portfolio loans, or local lenders familiar with condo-hotel projects. Residential condos are more likely to qualify for conventional financing if the project meets condo approval standards. Ask lenders early whether a specific building is warrantable and what terms they offer.
Insurance and coastal risk
Gulf-front properties in Destin face wind and flood exposure. Associations carry master insurance for the building and common elements. You typically hold an HO-6 policy for interior items and may be responsible for deductibles or loss assessments. Flood insurance is often required by lenders in FEMA flood zones, and premiums can vary based on elevation and mitigation features. Review the association’s insurance certificate, policy limits, and named storm deductibles before you commit.
Taxes and local compliance
If you rent short term, you or the operator must collect and remit Florida sales tax and local tourist development taxes in Okaloosa County and the City of Destin where applicable. Registration and collection processes vary by jurisdiction, so confirm whether the property lies inside Destin city limits or unincorporated Okaloosa County. Rental income is taxable, and in condo-hotels your net income reflects revenue after the program’s fees and expenses. Clarify how taxes are collected and who files them.
Resale and exit strategy
Condo-hotels can attract a narrower buyer pool focused on turnkey rental income, which can affect liquidity and pricing swings. Brand strength, operator reputation, and transparent rental history matter a lot for resale. Residential condos usually appeal to a broader audience that includes owners, second-home buyers, and investors, which can support marketability. Either way, stable association finances and clear documentation help protect value over time.
Which option fits your goal?
- If you want hands-off bookings and on-site services, a condo-hotel delivers convenience and brand marketing, but expect higher operating costs and fewer financing choices.
- If you want flexibility for personal use and easier financing, a residential condo often fits better while still allowing short-term rentals if the HOA permits them.
- If you prioritize broad resale appeal and control, a traditional condo with strong reserves and consistent HOA management may be your best long-term play.
Destin buyer checklist
- Define your priority: turnkey rental income or owner control and flexibility.
- Ask lenders about warrantability, down payment, rate, and available loan products for the specific building.
- Request the declaration, bylaws, rules, budget, reserve study, insurance certificate, and recent financials.
- For condo-hotels, ask for the management contract, rental program agreement, and sample owner statements.
- Verify state sales tax and local tourist development tax registration and who collects and remits them.
- Review meeting minutes, planned capital projects, reserve levels, and any pending or recent special assessments.
- Confirm owner use rules, blackout dates, cleaning policies, and any variable fees tied to rentals.
- Evaluate historical occupancy and average daily rate alongside your desired personal-use calendar.
How we help on the Emerald Coast
You deserve clear guidance that matches your goals to the right Destin property. Our team brings deep local knowledge of condo and condo-hotel buildings, seasonal dynamics, and real-world rental performance. We help you compare financing paths, review association documents, and understand fees, taxes, and insurance so you can move forward with confidence. Ready to explore your options or get a tailored short list of buildings? Connect with Sold in Paradise for concierge-level support from search to close.
FAQs
What is the main difference between a Destin condo and a condo-hotel?
- Both are condominiums, but condo-hotels integrate hotel operations and rental programs with possible owner-use limits, while traditional condos offer more control within HOA rules.
Can I get a conventional loan on a Destin condo-hotel?
- Many condo-hotels are non-warrantable for conventional programs, so buyers often use larger down payments or portfolio loans from lenders familiar with these projects.
How are short-term rental taxes handled in Destin and Okaloosa County?
- Short-term rentals are typically subject to Florida sales tax and local tourist development taxes, and owners or operators must register, collect, and remit them as required.
What insurance will I need for a Gulf-front condo?
- The association carries a master policy, and you usually carry an HO-6 policy for interiors; flood insurance is common in FEMA zones and windstorm deductibles may apply.
Which documents should I review before making an offer?
- Ask for the declaration, bylaws, rules, budgets, reserve study, insurance certificate, meeting minutes, management and rental agreements, financials, and sample rental statements.
