Property taxes due? Florida's Save Our Homes saves homeowners thousands. Here's how it works

Did the value of your homestead property surge in the last year? Probably!

Florida property is highly sought after. In September 2023, Florida Realtors reported that the median sale price for a home here was $409,243, up from $403,8850 the previous year. If you're planning to sell, this is wonderful news, but what about your property taxes? Newer homeowners may be concerned about a corresponding jump in the numbers in that envelope your local tax collector sends out.

But don't worry. For many Floridians, property taxes are guaranteed in state law not to rise more than 3% over the previous year, and it may be considerably less some years.

It's called the Save Our Homes program.

What is Florida's Save Our Homes?

In 1992, Floridians tired of double-digit tax hikes passed Amendment 10, or the Save Our Homes amendment to put a cap on homesteaded property tax increases and protect residents, especially those on fixed incomes, from being taxed out of their homes as property values rose.

Under Save Our Homes, which went into effect in 1994, the assessed value of a property covered by a homestead exemption cannot increase more than 3% or the percent change listed in the Consumer Price Index for all urban consumers, whichever is lower, as defined in Florida Statute 193.155. That means no matter how much the value of your property increases, the assessed value will never be more than 3% over what it was last year and may be less.

Sometimes that can be very low indeed. This year and 2022 are the first years in the last decade that the 3% cap has been used, as the CPI was 6.5% in 2023 and 7% in 2022. Before that, the CPI ranged from 2.% (2020) down to 0.7% (2016).

What's the difference between just value, assessed value and taxable value?

According to the Florida Department of Revenue:

• Just value is the property's market value, what it might sell for under current open market conditions.

• Assessed value is the just value, minus any assessments such as the "cap" or agricultural designation.

• Taxable value is the assessed value, minus any exemptions such as homestead, veteran, senior, widow, widower, permanently disabled and others.

Before Save Our Homes, taxable value was the just or market value minus exemptions, so if the housing market increased your taxes shot up along with it.

If you qualify for Save Our Homes, you can save thousands in property taxes.

How do I qualify for Save Our Homes in Florida?

Apply for homestead exemption using forms at the Florida Department of Revenue or your county's property appraiser. The cap is automatically applied to homestead properties.

Does Save Our Homes cap my property's taxable values if I make home improvements?

No. If you make any changes, additions or improvements to your property, that portion will be assessed at just value in the first year.

Check with your local property appraiser, different counties have different standards for what constitutes improvement. In parts of Southwest Florida, for example, replacing your roof after a hurricane may be counted as an improvement.

Not covered by Save Our Homes? Forced by insurance to replace roofs, Sarasota homeowners can expect higher tax bills, too

What happens if I buy Florida homestead property?

Once the property changes hands, the assessed value will be "reset" to full market value on January 1 of the following year, which can be a real shock to new homeowners depending on how long the previous homeowner had homestead exemption. The new owner will need to apply and qualify to receive homestead exemption to start SOH again on the new value.

Homestead deadlines: Why one woman's nightmarish tax bill doubled overnight and can she do anything about it?

If I sell my Florida homestead home and buy another, can I transfer my Save Our Homes benefits? What is 'portability'?

The longer you own your home, the larger the difference between its market value and its assessed value.

As of 2009, if you are a Florida homeowner moving from a homestead property, Save Our Homes allows you to transfer some or all of your existing tax benefits to a new home if it also qualifies for a homestead exemption, up to $500,000. The benefit is called "portability."

The amount of portability a home buyer can transfer is the market value of the home being sold, minus its assessed value. For example, if the just/market value of your previous home was $425,000 and the assessed, Save Our Homes-controlled value was $225,000, you have a benefit of $200,000 that can be used to reduce the assessed value of your new home. The 3% cap would apply to that new assessed value moving forward.

Homeowners have three tax years, or two calendar years, to claim their portability benefit.

'No clue how it works': Little-understood property tax rule can save homebuyers thousands

Was the Save Our Homes cap lowered in Florida?

In February 2023, a constitutional amendment was proposed to lower the cap to 2%. It died in the Finance and Tax Committee.

What if my Florida property isn't homesteaded?

Your property taxes can rise above a 3% increase over the previous year, but not above 10%. The Non-Homestead assessment limitation caps increases at 10% a year for real estate properties that do not receive a homestead exemption or classification.

It's automatic, you don't have to apply. The Non-Homestead assessment limitation does not apply to properties receiving the homestead exemption, agriculture classification, land used for conservation purposes, and tangible personal property.

What are homes selling for in Florida now?

In September 2023, Florida Realtors reported that the median sale price for a home here was $409,243, up from $403,8850 the previous year. The median sale price for a home in the U.S. in September was $418,800, according to the U.S. Census.

This article originally appeared on The Daytona Beach News-Journal: Florida Save Our Homes property tax assessment cap saves homeowners