DeSantis Just Moved to Eliminate Property Taxes for Millions of Florida Homeowners - But There's a Catch

Florida just took a major step toward eliminating property taxes for millions of homeowners, but the full picture is more complicated than it sounds.

On June 2, the state Legislature passed HJR 1F during a special session, with the House approving it 75-26 and the Senate 30-9. If approved, the measure, which heads to voters on November 3, could help some residents keep more cash in their wallets, but it will still need to pass with a 60% supermajority.

What the proposal would do

If approved, the plan would dramatically expand Florida's homestead exemption for primary residences. The exemption would increase from $50,000 to $150,000 in 2027, and then to $250,000 in 2028. At that level, state officials estimate that roughly 60% of Florida homeowners would owe $0 in annual property taxes on their primary homes.

It marks a significant shift in a state where property tax revenue has surged in recent years, rising from about $32 billion in 2019 to nearly $60 billion today. Many homeowners, especially those with modest property values, could see thousands of dollars in annual savings.

New residents may have to wait

The proposal isn't a free pass for everyone moving to Florida. Under the plan, new residents who establish primary residency after January 1, 2027 may have to wait up to five years before qualifying for the full exemption.

That delay is intentional. Governor Ron DeSantis has said the waiting period is designed to prevent people from relocating solely to take advantage of the tax break.

"I don't want Floridians to go and see this on the ballot and say, 'Oh man, I really would like the property tax relief, but I don't want the entire state of Illinois to empty out into Florida or wherever because of this,'" DeSantis said.

Anyone considering a move to Florida because of the potential savings should take note, as the full benefit would not apply right away.

How property taxes work

Property taxes don't just disappear without consequences. They fund essential local services, including public schools, police and fire departments, and infrastructure like roads and utilities.

If a large share of homeowners stops paying property taxes, local governments will need to find other ways to replace that revenue.

One possibility is higher sales taxes or increased fees. That could shift the tax burden rather than eliminate it entirely, meaning the net financial benefit may not be as large as it appears on paper. In other words, homeowners could save on property taxes but pay more in other areas.

Who benefits from the proposal?

The proposal applies only to primary residences, which means second homes, vacation properties, short-term rentals like Airbnbs, and commercial real estate would still be subject to property taxes.

For full-time Florida residents, especially those with lower home values, the change could provide meaningful relief. But for investors or part-time residents, the tax structure would remain largely unchanged.

Why this is happening now

The push to expand or eliminate property taxes comes as housing costs have surged across Florida. Rising home values have driven up property tax bills, putting pressure on homeowners, even those who have owned their homes for years.

At the same time, the state has seen rapid population growth, increasing demand for housing and public services. The proposal reflects an effort to address affordability concerns, but it also raises questions about long-term funding for local governments.

The wider impact on the housing market

If the measure passes, it could influence the housing market in several ways. Lower property taxes could make homeownership more attractive, potentially boosting demand and pushing prices higher in some areas.

At the same time, the waiting period for new residents could limit the immediate impact on migration patterns. There's also the possibility that shifting tax structures could affect local budgets, which in turn could influence everything from school funding to infrastructure investment.

The final hurdle is a 60% vote

The proposal now goes to voters on November 3, where it must receive at least 60% approval to pass. That's a high bar, meaning the outcome is far from certain.

Until then, the current property tax system remains in place, and no changes have been enacted.

What this means for your finances

Potential savings could be significant for homeowners, but only if the measure is approved and implemented as planned.

At the same time, it's important to consider the bigger picture. Changes to one type of tax often lead to adjustments elsewhere, and the overall financial impact will depend on how local governments respond.

Bottom line

Florida is moving closer to eliminating property taxes for a majority of homeowners, but the proposal comes with important conditions. New residents may have to wait years to qualify, and the loss of property tax revenue could lead to higher costs in other areas.

While the change could help some Florida homeowners save money on bills, it is not final. The measure still needs 60% voter approval on November 3, so it may be worth holding off on any financial decisions until the outcome is clear.

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