People in this state could see home prices rise by 9% if their property taxes were eliminated

Residents of one state could see a big jump in the value of their homes if voters make a major change in property tax collections.

Florida Governor Ron DeSantis has proposed eliminating or reducing property taxes on Florida homeowners who live on the property as their primary residence. Experts said the reduction would benefit homeowners immediately, as their property tax liability is priced into the current value of the home.

Florida home prices could rise as much as 9% if a proposal to eliminate property taxes on some homeowners is approved, according to an analysis by Realtor.com. According to calculations by the James Madison Institute, a Florida-based think tank, the average homeowner pays about $5,400 annually in property taxes.

Florida homeowners have seen their home values ​​begin to decline in recent years after rising during the pandemic-era housing boom. But it’s a controversial proposal that could change how the state’s tax burden is shared and must be approved by voters first.

“It will be a boon for existing landlords,” said Joel Berner, chief economist at Realtor.com. “But this measure would disproportionately benefit wealthy Floridians at the expense of those who do not own homes, and would make it more difficult to break into homeownership due to rising prices.”

Home values ​​rise in Florida, which increases the tax burden

The call to lower property taxes comes as Floridians have seen their tax bills rise as the value of their properties rises.

Realtor.com calculates that home values ​​in Florida have increased 42% since October 2019, before the spike in home prices during the COVID-19 pandemic. However, enthusiasm for Florida housing has subsided since then, with housing prices in October 3% lower than they were at the same time in 2022.

It could also increase the burden on renters, as rental properties are not included in the property tax proposals. Holiday home owners are also excluded from the proposal.

“This would be a very regressive tax, putting more of the state’s tax burden on renters, whose units are still taxed, and those taxes are passed on to renters,” Berner said.

While DeSantis has proposed eliminating all property taxes on owner-occupied homes in Florida, some lawmakers have floated more limited proposals that would continue collecting property taxes to pay for local schools. The proposal, which still includes collecting property taxes for schools, would reduce the increase in property values ​​to between 4.5% and 5%, Berner said.

Any proposal to change the property tax must be approved by the Florida Legislature as a constitutional amendment, which would then be put on Florida’s ballot in November 2026, where it would need to receive 60% of the vote to become law.