Florida Property Tax Amendment Could Reshape Real Estate

• Amendment 3 raises Florida's homestead exemption from $50,000 to $150,000 in 2027, then $250,000 in 2028
• Non-homestead assessment caps, covering commercial real estate, drop from 10% to 5%
• Florida Policy Institute estimates a $12 billion annual hit to local government revenue
• On the Nov. 3 ballot, needs 60% voter approval

The Trade-Off Behind Florida's Biggest Property Tax Swing in Two Decades

Florida voters decide November 3 whether to hand homeowners the largest homestead exemption bump since 2008, and commercial landlords the tightest assessment cap in the same stretch. Both come out of the same amendment, and both come with a catch.

Amendment 3 raises the primary-residence exemption from $50,000 to $150,000 in 2027 and $250,000 in 2028, then indexes it to the CPI. The Legislature could eventually build a schedule to eliminate homestead property taxes altogether, according to Broward County Property Appraiser Marty Kiar. For non-homesteaded property, including apartment buildings, office towers, and retail centers, the annual assessment increase cap drops from today's 10% to 5%, giving owners a tighter ceiling on how fast their tax basis can climb.

Gov. Ron DeSantis called the special legislative session that put the measure on the ballot, though he's not campaigning for it now that lawmakers stripped two of his asks: a plan to eventually eliminate school property taxes, and a state trust fund meant to backstop local governments against the revenue loss. What's left protects only school funding. Everything else, police, fire, parks, is exposed. Police and fire unions have come out against the amendment.

The ballot language itself has already been through a fight. Attorney General James Uthmeier rewrote the title and summary last week after Judge David Frank ruled the original, "Save Our Homes From Excessive Property Taxes," read more like a slogan than a neutral description of what voters were deciding.

What a Tighter Assessment Cap Actually Buys Investors

The 5% cap is the part that matters most for commercial owners. It gives landlords and investors a firmer ceiling when underwriting future tax expenses, real predictability on paper. But Barry Lapides, an attorney at Berger Singerman, isn't convinced it moves the needle on deals.

"This is certainly a pro-business, pro-resident initiative, but I'm not sold on the fact that any savings will be passed along to the renters. This does not solve the affordability crisis."

Lapides' read is that a lower cap won't make or break an underwriting decision on its own, and if it does, the deal probably wasn't a good one to begin with. His bigger concern is what happens on the other side of the ledger: if homestead exemptions cut into residential collections, cities still need the revenue.

"Taxing authorities still have the ability to set millage. If local governments are getting less tax revenue from the residential homestead side, it would seem to me they're going to be looking for the revenue from the non-homestead, either residential or commercial side."

Michael Tillman, CEO of Fort Lauderdale-based PTM Partners, framed it the same way from the development side.

"Amendment 3 isn't that simple."

If municipalities raise millage rates or cut services to cover the gap, Tillman said the net effect on any given tax bill becomes uncertain again, undoing the predictability the assessment cap was supposed to deliver in the first place.

The Revenue Gap Splits Florida's Cities Unevenly

The Florida Policy Institute puts the amendment's recurring annual cost to local governments at nearly $12 billion, but that number lands very differently depending on the city. Kiar has been running the math city by city: Pembroke Park would see just a 1.2% drop in collected property taxes under the $250,000 exemption. Cooper City, with a heavier concentration of homesteaded property, would lose around 35%. Parkland, where more than 75% of tax revenue comes from homesteaded property, takes the biggest hit of the three.

Boca Raton Mayor Andy Thomson said that math forces real choices.

"In the city of Boca Raton, 55 percent of our annual budget is ad valorem taxes. We do charge for things like water, and we have fees for other services, but the downside is we potentially have to start getting more creative on how we bring in revenues. Our residents have come to expect a really high quality of life and really quality services, elite level services, and I don't hear anybody saying we are willing to accept cuts or a reduction in the level of those services."

Fort Lauderdale Mayor Dean Trantalis raised a similar point at a property tax panel held last week at the Tower Club, framing the debate as one that needs to account for the residents and visitors who expect the services that make South Florida's quality of life a selling point in the first place.

Why It Matters Beyond the Ballot

Florida hasn't touched property taxes at this scale since 2008, when voters raised the total homestead exemption to $50,000, added portability, and set the 10% non-homestead cap that Amendment 3 would now cut in half. If millage rates climb in response to this round of cuts, owners of non-homestead property, apartment buildings, office complexes, and shopping centers, will likely pass those increases to tenants, according to industry sources. That would blunt the predictability the lower assessment cap is designed to create.

Florida has 411 municipalities across 67 counties, and the fiscal exposure ranges from a rounding error to an existential budget problem depending on how homestead-heavy the tax base is. For developers and brokers underwriting anything in the state, the number to watch after November 3 isn't the exemption amount. It's whatever millage rate their city sets next.