Florida voters have approved a constitutional amendment that will substantially expand the property-tax exemption for primary residences, while also slowing assessment increases on many other properties. Supporters say the change will ease household costs and may add to Florida’s appeal for newcomers. Critics warn it could leave local governments with less money for essential services.
Key takeaways
Amendment 3 passed with about 62% of the vote, clearing the 60% threshold required for a constitutional amendment. Its largest direct benefit is aimed at primary-residence owners, but its effects on local budgets and investment properties are also drawing attention.
- The homestead exemption for most non-school property taxes rises to $150,000 in 2027 and $250,000 in 2028.
- Owners of second homes, rentals and other non-homestead properties will get a lower annual cap on assessed-value increases.
- New residents who miss the Dec. 31, 2026, eligibility date must wait until their fifth year of homestead eligibility for the expanded exemption.
- Local governments could lose as much as $11.86 billion annually once the changes are fully implemented, according to state estimates.
What the amendment changes
The expanded exemption applies to the portion of property taxes that supports local services, not school taxes. After reaching $250,000 in 2028, the exempt amount will be adjusted for inflation beginning in 2029. Actual savings will depend on a home’s assessed value and local tax rates.
The amendment also cuts the annual limit on increases in assessed value for non-homestead properties from 10% to 5%. That can slow tax-bill growth for vacation homes, rentals and commercial properties as values rise. The cap applies to assessed values rather than tax rates, and an assessment may reset when a property changes hands.
Relief is more significant for typical homeowners
The exemption is a fixed dollar amount, so it reduces a larger share of the taxable value of a moderately priced home than of a multimillion-dollar estate. A real estate attorney cited in reporting estimated annual savings of about $2,085 for a typical homestead owner once the full exemption takes effect. For a $50 million primary residence, the estimated reduction was only about $2,000 a year.
The lower assessment cap may matter more to affluent owners with multiple Florida properties. One estimate, assuming property values rise 8% annually, put the five-year savings on a $50 million second home at roughly $280,000. Real estate professionals say the exemption alone is unlikely to determine whether very wealthy buyers relocate, though it may influence the timing of a move.
Local services face an uncertain trade-off
The amendment does not provide replacement state funding for local revenue losses, and it does not guarantee minimum funding for police, fire or emergency medical services. Miami-Dade County has estimated a potential first-year loss of about $385 million. Officials and critics warn that smaller or rural communities, with fewer alternative revenue sources, may have less room to absorb cuts.
Local governments could consider higher tax rates or reduce services, but either response could affect residents. Reduced fire protection may also influence insurance risk assessments and potentially contribute to higher premiums. The scale of those effects remains uncertain as communities prepare for the new rules.
- Florida approves sweeping property-tax breaks, New York Post.
- Florida’s new $250,000 homestead exemption barely makes a dent for billionaires, Fortune.
- Florida’s new property tax cuts that ‘proved’ Google co-founder Larry Page, Oracle founder Larry Ellison, Citadel CEO Ken Griffin and other billionaires move to ‘Billionaire Bunkers’ may be right; also raises ‘rural dark ages’ debate, The Times of India.
- Florida approves primary residence tax break of up to $250,000 — Fortune, UA.NEWS.