By Gay Cororaton, MIAMI REALTORS Chief Economist
Key takeaways
- Florida’s homestead law enables a homeowner who uses the property as a primary residence to apply for a homestead real property tax exemption and to avail of the Save our Homes (SOH) assessment limitation and the portability of the SOH assessment benefit when the homeowner establishes a new homestead.
- Based on the 2024 tax roll, 1.4 million homeowners have a homestead exemption in Southeast Florida, of which about 1 million live in single-family homes.
- MIAMI estimates that the median tax savings is about $5,000 for all homeowners with a homestead exemption as of the 2024 tax roll.
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Homestead Law helps to lower property taxes
Florida’s lower real estate taxes are due to a generous homestead law. A homestead is a property that the homeowner resides in as the primary residence and that is owned in the individual’s name (not an LLC, corporation, or irrevocable trust). The tax benefits of a homestead property come from:
-the Homestead Exemption from taxes of up to $50,000 of the assessed value
-the Save Our Home Assessment (SOH) assessment limitation of the lower of 3% or the Consumer Price Index inflation
-eligibility to transfer up to $500,000 of the SOH benefit (just value less assessed value) from the old homestead to the new homestead within three years
-additional reduction in assessed values or full exemption for eligible individuals like those in the Army, senior citizens, the disabled, and spouses of fiirst responders who lost their lives in the line of duty.
Homeowners with homestead exemption in tax year 2024 expect about $5,000 in savings from real estate taxes benefiting 1.4 million homeowners
The homestead tax exemption and SOH assessment limitation and portability has given significant real estate tax benefits to homeowners as property values have increased, particularly during the past five years. In the condominium/townhomes market, the median sales prices have also more than doubled in Miami-Dade (+76%), Broward (+57%), Palm Beach (+67%), and St. Lucie (+74%), with a smaller increase in Martin (+33%).
According to MIAMI Realtors® analysis tax roll data in 2024, the expected tax savings on homestead properties (single-family, mobile homes, condominiums/townhomes) is $5,600 in Miami-Dade County; $5,200 in Broward County; $4,800 in Palm Beach County; $4,400 in Martin County; and $3,700 in St. Lucie County.
These savings are based on the difference between the median just (or market) values and the median appraised value, the median homestead exemption, and a millage rate of 20%.
The homestead exemption benefited about 1.4 million homeowners who lived in single-family homes, mobile homes, and condominiums/townhomes in the five Southeast Florida counties, or 61% of total homeowners. Of these 1.4 million, about 1 million lived in single-family homes.
Among single-family homeowners in the five Southeast Florida counties, 75% have a homestead exemption. Among condominium/townhome homeowners, only 39% have a homestead exemption, and this could be because these properties are being rented out for more than 30 days in a year or were purchased as vacation homes or investment properties.
Among single-family homeowners, the homestead exemption benefit runs in the tens of thousands of dollars in areas with high median home values.
In Miami-Dade County, the highest real estate tax savings is among residents in Indian Creek where single-family homes have a median just value of $44.8 million, with the median tax savings at $587,600.
In Broward County, Sea Ranch Lakes with a median just value of $2.5 million has the highest real estate tax savings of $30,600
In Palm Beach County, the town of Palm Beach with a median just value of $10.2 million has the highest expected real estate tax savings of $118,800.
In Martin County, Jupiter Island with a median just value of $6.8 million has the highest expected tax savings at $60,900.
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