Florida Amendment 3: The Homestead Exemption Overhaul Goes to Voters

• Amendment 3 ("Increased Homestead Exemption; Lower Cap on Increases in Non-Homestead Property Assessments") comes from HJR 1F, passed in special session on 2 June 2026. It needs at least 60% voter approval.

• The non-school homestead exemption would rise from today's typical $50,000 to $150,000 in 2027 and $250,000 in 2028, indexed to inflation from 2029. School district levies are excluded.

• Residents established by 31 December 2026 qualify for the larger exemption. Those arriving on or after 1 January 2027 start at $50,000 (CPI-adjusted from 2028) and move up only from their fifth homestead year.

• Non-homestead property would see its annual assessment cap cut from 10% to 5% for non-school levies.

• Local budgets would face a narrower millage ceiling and a closed list of seven purposes for property tax revenue.

• The Revenue Estimating Conference puts the recurring cost at about $12 billion, excluding any later full elimination of non-school homestead taxes.

• If approved, the changes take effect on 1 January 2027 and first appear on August 2027 TRIM notices.

Amendment 3 is the product of a special legislative session. Governor Ron DeSantis had pressed for years to eliminate property taxes on homesteads. When the 2026 regular session ended without action, he called lawmakers back. On 2 June 2026 the Legislature passed HJR 1, a joint resolution titled "Save Our Homes from Excessive Property Taxes", and sent it to the November ballot.

As a constitutional amendment, it needs the approval of at least 60% of those voting on 3 November 2026. A simple majority will not be enough.

The proposal has four core elements:

1. A much larger homestead exemption for all non-school levies, phased in from 2027.

2. A residency rule that gives later arrivals a smaller exemption for their first years.

3. A cut in the annual assessment cap on non-homestead property from 10% to 5%.

4. Limits on the purposes for which local governments may use property tax revenue.

It would also require the Legislature to create a procedure through which local governments could keep raising the exempt amount, up to the full value of a homestead.

For 2026 a qualifying homestead receives up to $51,411 in exemptions: $25,000 against all levies, including school taxes, plus a CPI-adjusted $26,411 against non-school levies. Amendment 3 would replace that structure. The first $25,000 would stay exempt from school taxes, and the exemption from non-school levies would rise to $150,000 on 1 January 2027 and $250,000 on 1 January 2028, indexed to inflation from 2029. The Legislature would also have to create a uniform procedure letting counties and municipalities go further, up to full exemption of a homestead's remaining assessed value.

The Pinellas County Property Appraiser illustrates the scale. At that county's 2025 average non-school rate of 12.2011 mills, a homestead receiving the full exemption would save about $1,203 in 2027 and $2,423 in 2028. Actual savings will vary with assessed value, Save Our Homes benefits, other exemptions and local millage.

Save Our Homes, portability and existing personal exemptions for seniors, veterans, widows and people with disabilities are unchanged. The larger exemption does not reduce non-ad valorem assessments.

The new exemption applies to every levy except school district taxes. That exclusion is central to the measure's real-world effect. School taxes are often the largest single item on a homeowner's bill, so most homesteaders would still receive a bill even after 2028.

Tighter controls on local budgets. The amendment, together with its implementing bill SB 4F, goes beyond exemptions:

• Millage ceiling. The default maximum rate would narrow to the rolled-back rate, the rate that raises the same revenue as the prior year. Up to 110% of that rate would need a two-thirds vote of the governing body, and anything higher a unanimous vote.

• Category lock. County and municipal property taxes could fund only seven listed purposes: public safety; education and schools; infrastructure such as roads, bridges and stormwater; natural resource projects including flood control; bonds and debt service; employee retirement obligations; and the operations of county officers, commissioners and municipalities.

Amendment 3 creates two classes of homesteader, separated by a single date. Anyone who is a permanent Florida resident by 31 December 2026 qualifies for the larger exemption from 2027. That holds even if they have not yet bought a home. The higher exemption becomes available whenever they later buy and apply for homestead.

People who become residents on or after 1 January 2027 face a waiting period:

For movers who arrive in 2027 or later, the result is four homestead years with a far smaller non-school exemption than a long-time neighbour in a comparable home. Implementing legislation may add administrative detail on how residency is proved and tracked.

From 2027, annual increases in the assessed value of non-homestead property would be capped at 5%, down from 10% today. The cap covers second homes, rental and commercial property and vacant land.

Two limits narrow the benefit. The cap applies only for non-school levies, so school taxes would still be based on full just (market) value. And it limits growth in assessed value, not tax rates. If local governments raise millage to make up for lost homestead revenue, owners of non-homestead property could still see higher bills.

The Fiscal Cost: About $12 Billion a Year

Florida's Revenue Estimating Conference puts the recurring cost of Amendment 3 at roughly $12 billion a year. The conference brings together the Governor's office, the Legislature and the Office of Economic and Demographic Research. Its figure covers the $250,000 exemption and the 5% non-homestead cap. It does not include the cost of eliminating non-school homestead taxes altogether, which the amendment would authorize the Legislature to enable later.

The transition is steeper at first. Legislative fiscal analysis estimates local revenue losses of $4.6 billion in the first year and $8.4 billion in the second. The amendment itself contains no replacement revenue.

The exposure is large because property tax is the backbone of local finance. It supplied 74% of local tax collections in Florida in fiscal year 2023, and homesteads account for 46.6% of the just value of all real property. In Orange County, fire and sheriff levies alone account for an estimated $118 million of the 2028 reduction.

Where the money could come from. Local options are narrow. Local option sales taxes are capped at 1.5%, well short of what would be needed to replace the revenue. Counties and cities would likely combine spending cuts, fees and higher millage on property that remains taxable. The Tax Foundation, the Florida Policy Institute and the Florida Chamber of Commerce have each warned that the burden could shift to renters, businesses, second-home owners and newer residents.

Private client and relocation advisers. For clients planning a move to Florida, the timing of residency is now a planning question with a price attached. Establishing permanent residency by 31 December 2026 would secure access to the larger exemption, while arriving on or after 1 January 2027 means four homestead years at the lower level. Clients should document residency carefully, since the implementing legislation may set out how it is proved. If the amendment fails, the date has no effect.

Real estate, lending and valuation professionals. Non-school taxes on homesteads could fall sharply from the November 2027 bills. Pricing, affordability assessments and escrow estimates may need to reflect whether a buyer qualifies as a pre-2027 resident. School taxes remain unaffected, so homesteaders will still receive bills.

Commercial owners, landlords and investors. The 5% cap slows growth in assessed value, but it does not cap tax rates. Where local governments raise millage to offset lost homestead revenue, non-homestead owners could pay more. Budgets for 2027 and beyond should be stress-tested against higher millage, and lease terms reviewed for how tax increases pass to tenants.

Local government counsel and finance officers. If approved, the amendment takes effect on 1 January 2027 and would first appear on August 2027 TRIM notices. Revenue projections, bond covenants and service commitments should be modelled now against the $150,000 and $250,000 steps, the narrower millage ceiling and the seven-category limit on property tax spending.