Understanding Florida’s Save Our Homes cap reveals it limits homesteaded property tax increases to 3% annually or inflation, whichever is lower. To qualify, you must have a Florida Homestead Exemption. This cap controls taxable value, not market value, offering long-term savings. Upon sale, the cap resets, but portability allows tax savings transfer to a new Florida home.
What is Florida’s Save Our Homes Cap?
The Save Our Homes cap is a rule that limits the increase of a homestead property’s assessed value to 3% per year or the rate of inflation, whichever is lower. This means even if your home’s market value skyrockets, your taxable value stays in check.
Here’s what that means in action:
- You bought your house for $300,000.
- Market value jumps to $400,000 in a few years.
- Without the cap, your tax bill would explode.
- With the Save Our Homes cap, your home’s assessed value only rises a max of 3% per year.
Pretty solid, right? Now, let’s talk about how you qualify for it.
Who Qualifies for the Save Our Homes Cap?
Before you start celebrating lower taxes, let’s make sure this actually applies to you. To get the Save Our Homes cap, you have to meet these conditions:
- Your property must be your primary residence.
- You must have filed for a Florida Homestead Exemption.
- It only applies to homesteaded property, not rental properties or second homes.
Filing for the Florida Homestead Exemption is key. If you don’t apply, you miss out on the cap. And the deadline? March 1st each year. Mark it down.
How the Save Our Homes Cap Affects Your Property Taxes
Alright, so your home’s assessed value can’t jump more than 3% per year. But what does that actually do to your property tax bill?
Let’s break it down.
- Market value goes up: Your home’s market value increases, but thanks to the cap, your assessed value only inches up.
- Taxable value stays controlled: Taxes are based on assessed value, not market value, so your tax bill doesn’t swing wildly.
- Big savings over time: Over 10-15 years, this cap can keep thousands in your pocket.
Without this, homeowners could see double-digit property tax hikes in hot real estate markets. Imagine going from paying $4,000 in property taxes one year to $7,000 the next. That’s real money.
What Happens When You Sell Your Home?
Here’s where it gets interesting. If you sell your home, the assessed value resets to the full market value for the new owner. That means the new homeowner gets taxed on the full value—no cap protection.
But if you’re buying another home in Florida, you might not lose all the tax savings. Florida has something called portability, which allows you to transfer some of your tax savings to your next home.
Conclusion
The Save Our Homes cap makes Florida homeownership more predictable. It keeps property taxes steady even when home values surge. If you’re living in your home full time and haven’t filed for your Homestead Exemption, don’t wait. The tax savings are real.
FAQs
Does the Save Our Homes cap apply to rental properties?
No. The cap only applies to homes where you live full-time and have a Homestead Exemption. Rental properties don’t get this tax break.
What if my home’s value drops?
If market values fall, your assessed value won’t increase by 3%. It doesn’t go backward, but it also won’t increase beyond what the cap allows.
Can I lose the Save Our Homes cap?
Yes. If you move, rent out your home, or forget to maintain your Homestead Exemption, you lose the cap. And when you buy a new home, the property value resets.
How do property taxes in Florida compare to other states?
Florida has no state income tax, but property taxes are middle-of-the-road nationwide. The Save Our Homes cap helps keep tax bills from running away.
