I recently had the opportunity to attend a private presentation examining the proposal, including its potential economic impact, constitutional implications, and the changes it could bring to Florida's real estate market.
Here's what Florida property owners need to understand before voting.
What Is Florida Amendment 3?
Amendment 3, officially titled Increased Homestead Exemption; Lower Cap on Increases in Non-Homestead Property Assessments, proposes several significant changes to Florida's property tax system.
If approved by at least 60% of voters, it would:
Increase the homestead exemption for non-school property taxes to $150,000 in 2027 and $250,000 in 2028.
Adjust the increased exemption for inflation beginning in 2029.
Reduce the annual assessment increase cap for qualifying non-homestead properties from 10% to 5%.
Establish a waiting period for certain individuals who become Florida residents after December 31, 2026.
Allow additional homestead exemptions through procedures established by the Legislature.
Change how counties and municipalities are permitted to use property tax revenue.
The amendment would take effect January 1, 2027.
It's important to understand that Amendment 3 would not eliminate all property taxes, nor would it eliminate school district property taxes.
Understanding Florida's Current Homestead Exemption
Florida homeowners who use their property as their permanent residence may qualify for a homestead exemption that reduces the assessed value used to calculate property taxes.
Under the current system, qualifying homeowners generally receive:
An initial exemption of up to $25,000 that applies to school and non-school property taxes.
An additional exemption that applies only to non-school property taxes and is adjusted annually for inflation.
In 2026, the total maximum exemption is approximately $51,411 for non-school property taxes. Florida also offers Save Our Homes protections, generally limiting annual assessment increases on qualifying homestead properties to the lesser of 3% or the applicable change in the Consumer Price Index.
These protections can become especially valuable for homeowners who have owned their homes for many years. However, increasing home values, rising insurance premiums, and adjustments to local tax rates have continued to put pressure on homeowners' budgets.
How Much Would the Homestead Exemption Increase?
Under Amendment 3, the total exemption applicable to non-school property taxes would increase dramatically. For qualifying properties, this could eliminate the county, municipal, and other covered non-school property taxes on much or all of the home's assessed value.
Consider a homeowner whose property has a $200,000 assessed value for tax purposes.
By 2028, a $250,000 non-school exemption could reduce the taxable value for covered non-school property taxes to zero. But that homeowner could still owe school district property taxes and applicable non-ad valorem assessments.
For homeowners whose assessed values exceed $250,000, the exemption would reduce—but not necessarily eliminate—the portion of their property tax bill attributable to non-school taxes.
The actual savings would depend on assessed value, existing exemptions, local millage rates, and other applicable tax provisions.
How Much Could Florida Homeowners Actually Save?
To illustrate how Amendment 3 could affect property taxes, consider a simplified scenario in which a homeowner qualifies for the full increased exemption.
Assume:
The home's assessed value is $350,000.
The current non-school homestead exemption is approximately $50,000.
The proposed 2028 exemption is $250,000.
The combined applicable non-school millage rate is 10 mills.
A mill represents $1 in property tax for every $1,000 of taxable property value.
For example, consider a home with an assessed value of $350,000 and a combined non-school property tax rate of 10 mills.
Under the current system, the homeowner would receive approximately $50,000 in homestead exemptions, reducing the taxable value to $300,000. At 10 mills, the annual non-school property tax would be $3,000.
Under the proposed 2028 system, the homestead exemption would increase to $250,000, reducing the taxable value to just $100,000. At the same 10-mill rate, the annual non-school property tax would drop to $1,000.
That's an estimated savings of $2,000 per year, or approximately $167 per month.
Keep in mind that this is a simplified illustration using a rounded current exemption and assuming unchanged millage rates. Actual savings would vary, and homeowners would still be responsible for applicable school district property taxes and non-ad valorem assessments.
Illustrative annual savings: $2,000.
That would represent approximately $167 per month in reduced annual property tax expense.
For homeowners with mortgages, those savings could eventually be reflected in monthly escrow payments after a lender updates its tax estimates and conducts an escrow analysis.
However, this example assumes unchanged millage rates and does not include school taxes, special assessments, or other adjustments.
A homeowner's purchase price or estimated market value should not be confused with the assessed value used to calculate property taxes.
What About School Property Taxes?
This is one of the most important details in the entire proposal.
Amendment 3 does not provide the increased $250,000 exemption against school district property taxes.
Florida school districts would continue collecting property taxes under the applicable school-tax rules. This means homeowners should be cautious when hearing claims that Amendment 3 would eliminate their property tax bills entirely. Even homes with assessed values below $250,000 could still have property tax obligations.
Furthermore, charges such as solid waste collection, stormwater fees, or other non-ad valorem assessments may continue to appear on a homeowner's annual tax bill. These charges are not necessarily calculated using the property's taxable value and should not be confused with traditional ad valorem property taxes.
A Major Change for Rental Properties and Real Estate Investors
Amendment 3 is not limited to primary residences. Another major provision could directly benefit owners of investment properties, vacation homes, commercial buildings, and certain other non-homestead real estate.
Florida currently limits annual increases in the assessed value of many qualifying non-homestead properties to 10%, subject to applicable assessment rules and exceptions. Amendment 3 would reduce that ceiling to 5% annually.
Why does this matter?
For example, consider an investment property with an initial assessed value of $200,000.
Under Florida's current system, qualifying non-homestead properties are generally subject to a maximum annual assessment increase of 10%. Assuming property values rise enough for that cap to apply each year, the property's assessed value could increase to $220,000 after the first year, $266,200 after three years, and approximately $322,102 after five years.
Under Amendment 3, that annual assessment cap would decrease to 5%. Using the same $200,000 starting value, the assessed value could increase to $210,000 after the first year, $231,525 after three years, and approximately $255,256 after five years.
After five years, the difference in assessed value would be approximately $66,846.
This could translate into meaningful property tax savings for investors, particularly those who hold properties long-term. However, the assessment cap limits increases in assessed value, not the actual property tax bill. Changes in millage rates, property ownership, and other factors could still affect the taxes owed.
What this means for Central Florida investors
Central Florida has an extensive market for long-term rental homes, second homes, vacation properties, and short-term rental investments.
For investors considering properties in Kissimmee, Davenport, Orlando, and surrounding communities, reducing future assessed-value growth could provide greater predictability in long-term operating expenses. This could be particularly relevant to investors holding properties for extended periods.
However, buyers should never assume that a property's existing tax bill will remain unchanged following a purchase. A change in ownership can trigger reassessment, so projected taxes should be evaluated using the buyer's anticipated circumstances rather than relying entirely on the seller's current tax bill.
The Five-Year Residency Rule: An Important Detail for People Moving to Florida
One of the most unusual—and potentially controversial—provisions of Amendment 3 concerns people who establish Florida residency after December 31, 2026.
Under the proposed language, qualifying individuals who were already Florida residents by that date would generally be eligible for the enhanced exemption when they qualify for a Florida homestead. This could include residents who currently rent and purchase their first Florida home several years later.
However, individuals who are not Florida residents by December 31, 2026, would generally receive the existing homestead exemption when they first qualify and become eligible for the enhanced exemption beginning with their fifth year of exemption. In other words, two homeowners purchasing similarly valued properties could initially receive different homestead benefits depending on when they established Florida residency.
Could the residency provision face a legal challenge?
During the private presentation, attorney H. French Brown IV highlighted potential constitutional questions surrounding this provision. He discussed an earlier Florida homestead exemption change involving a waiting period for newer residents, which was challenged on equal-protection grounds.
The concern is whether Florida can provide substantially different tax treatment to otherwise similarly situated residents based on when they established residency. Amendment 3 explicitly qualifies the restriction by reference to what is permitted under the U.S. Constitution.
The presenter suggested that the residency provision could face litigation if the amendment passes. Importantly, that is a legal prediction, not an established court ruling about Amendment 3.
The ultimate application of the residency provision could depend on future legislation, interpretation, and potential court decisions. For relocation buyers considering Florida, this uncertainty is worth monitoring closely.
Why Amendment 3 Could Have a Major Financial Impact on Local Governments
According to figures presented during the meeting, Florida's statewide property tax collections have increased significantly over the past decade.
In 2015, school boards collected approximately $12 billion in property taxes. By 2025, that figure had increased to $22.9 billion. Counties experienced even greater growth, with property tax collections rising from $10.4 billion in 2015 to $23.2 billion in 2025.Cities also saw substantial increases, collecting $4 billion in 2015 compared to $9.4 billion in 2025.
Meanwhile, special districts, which help fund various local services and infrastructure, saw their collections rise from $1.9 billion to $3.8 billion over the same period.
Altogether, Florida's statewide property tax collections increased from $28.3 billion in 2015 to $59.3 billion in 2025—an increase of approximately 110% in just ten years.
These figures help illustrate why Amendment 3 could have such a significant impact on local government finances. Property taxes have become an increasingly substantial source of revenue, and reducing the amount collected could require counties, cities, and special districts to reconsider how they fund public services.
It's also important to recognize that increased tax collections reflect several factors, including population growth, new construction, rising property values, and changes in taxable property assessments—not necessarily increases in property tax rates.
Why Some Florida Counties Could Be Affected More Than Others
One particularly interesting part of the presentation involved a statewide analysis of homestead property values. A county with a large concentration of lower-assessed-value homes could experience a greater reduction in its property tax base under the proposed $250,000 exemption.
For example, if many qualifying homesteaded properties in a county have assessed values below $250,000, a substantial share of those homes could stop contributing to certain non-school property tax levies.
By contrast, in counties where homesteaded properties have significantly higher assessed values, more properties would retain some taxable value after the exemption.
The presenter noted that this difference could be especially noticeable between portions of North Florida and higher-value markets in South Florida. However, these comparisons must be interpreted carefully. A map showing the percentage of homesteaded properties below a certain assessment threshold does not measure the full effect on a county's tax base. Non-homestead residential properties, commercial buildings, and other taxable properties also contribute to local revenue.
Could Cities and Counties Raise Fees or Find Other Revenue Sources?
A reduction in property tax revenue does not automatically mean a corresponding reduction in public spending. Local governments have several possible responses. Depending on their authority and financial circumstances, these may include:
Adjusting budgets or reducing expenditures.
Modifying permissible tax rates.
Using available reserves.
Increasing certain service-related fees.
Reassessing capital projects and infrastructure spending.
Relying more heavily on other authorized revenue sources.
The presentation specifically identified alternatives such as impact fees, user charges, utility fees, stormwater fees, permit and inspection fees, and non-ad valorem special assessments. However, these revenue sources are not interchangeable.
For example, impact fees are generally subject to legal restrictions related to growth-related infrastructure and cannot simply be used as unrestricted replacements for property tax revenue.
Similarly, special assessments generally must satisfy legal requirements related to the benefits received by assessed properties.
For homeowners, the broader issue is that a reduction in one category of taxes does not necessarily guarantee an equivalent reduction in the total cost of owning a home.
Would Amendment 3 Affect Public Services?
The proposal also addresses how counties and municipalities use property tax revenue. Its language identifies spending categories that include public safety, education and schools, infrastructure, natural resources, bond debt service, retirement benefits for employees, and government operations and administration. It also allows certain additional expenditures through approvals described in the amendment, unless prohibited by general law.
Supporters of property tax reform argue that substantial tax reductions could encourage local governments to prioritize spending, improve efficiency, and reduce financial pressure on property owners. Critics argue that losing a significant portion of anticipated property tax revenue could make it more difficult for local governments to fund public safety, maintain infrastructure, and provide community services without reducing spending or increasing other revenues.
Neither outcome should be treated as automatic. The actual consequences would vary by jurisdiction and would depend on budgets, future legislation, millage decisions, and the choices made by local officials.
Property taxes are only one piece of the financial equation. Understanding assessments, exemptions, financing, insurance, and the local real estate market can help you make more informed decisions.
I'm always happy to help you evaluate your real estate options and understand how these factors may affect your plans.
This article is provided for educational purposes and does not constitute legal, tax, or financial advice. Property tax laws, exemptions, and assessments are subject to specific eligibility requirements. Consult the appropriate county property appraiser, tax collector, legal professional, or tax advisor regarding your circumstances.
Sources and references
Florida Department of State — 2026 Amendment 3 official ballot text.
Florida Legislature — CS/HJR 1-F, 2026 Special Session.
Florida Office of Economic & Demographic Research — Property tax studies and fiscal analyses.
H. French Brown IV — Focus on Florida Property Tax: Amendment 3, presentation delivered to Osceola-area real estate professionals, 2026.
Florida Department of Revenue — Property tax and homestead exemption information.
