Will getting rid of property taxes make Florida more affordable?

Florida and Texas lack state income tax, which has helped attract businesses, residents, wealth, and jobs. Removing property taxes for primary homeowners could further increase the state’s attractiveness for people relocating from higher-tax states. Property tax bills can be very high in Florida, but commercial property taxes and taxes on rental vacation homes and secondary residences would remain. A special legislative session is planned to begin debate, with approval requiring 60% of lawmakers and later 60% of voters in a statewide referendum. The governor also proposed a five-year Florida residency requirement before qualifying for tax relief. A Realtor and investment expert said the change could improve affordability and increase home values, estimating a 4% to 9% price increase and about $30,000 to $40,000 in equity, especially aiding first-time buyers facing rapidly rising ownership costs.

"Removing property taxes for primary homeowners, he said, could further strengthen the state's appeal to employers and residents relocating from higher-tax states. If someone's now looking at, say, New York versus Florida, or many other states from a jobs perspective, you can now say with the affordability, Come live in Florida, work in Florida, buy a home in Florida and not pay property taxes,' Davis said. Property tax bills can be absolutely exorbitant in Florida."

"DeSantis has called a special legislative session next week to begin debate on the measure. Approval would require support from 60% of lawmakers and later 60% of voters in a statewide referendum. The governor also proposed requiring residents to live in Florida for at least five years before qualifying for the tax relief."

"Beth Silverman, a Realtor and investment expert with eXp Realty in Florida, said the proposal could simultaneously improve affordability and increase home values. I think it's a little bit of both, she said. I think that if this passes, we're looking at a 4% to 9% increase in prices for a Florida homeowner. The equity is about 30 to 40 grand, which is great."

"However, that's not the real affordability piece. Silverman said the proposal could especially benefit first-time buyers struggling to absorb rapidly increasing ownership costs after purchasing a home. Say you have a first-time buyer, newly married, and they bought a house for $420,000, she said. The taxes at the time of closing were $3,200, their insurance was $3,750 and the monthly mortgage was $3,500."

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