At a glance
- The homestead exemption would triple to $150,000 in 2027, then rise to $250,000 in 2028, with later increases tied to inflation.
- For owners of commercial buildings and second homes, the amendment slows how fast assessed value grows, not the value itself.
- Local government budgets in Florida climbed nearly 75% to $59.2 billion between 2019 and 2025, according to state data cited by Commercial Observer.
Florida voters decide Tuesday on Amendment 3, which would hold annual increases in the assessed value of commercial buildings and second homes to 5%, down from 10%, starting next year.
The homestead exemption would triple to $150,000 in 2027, then rise to $250,000 in 2028, with later increases tied to inflation. Florida Legislature analysts estimate the resulting revenue shortfall to local governments at $4.6 billion in 2027, $8.4 billion in 2028 and nearly $12 billion in 2032, Commercial Observer reported.
For owners of commercial buildings and second homes, the amendment slows how fast assessed value grows, not the value itself. The second-order effect may matter more. If the tax base from primary homes shrinks, local officials may become more dependent on revenue from commercial properties and more receptive to approving new projects, said Neil Schiller, managing partner at law firm Government Law Group, who advises clients on land use and zoning. That suggests the fiscal pressure behind the amendment, rather than the 5% cap alone, is what developers holding Florida entitlements should watch in local approvals.
Local government budgets in Florida climbed nearly 75% to $59.2 billion between 2019 and 2025, according to state data cited by Commercial Observer. Gov. Ron DeSantis has pursued property tax cuts in response and has said the state could provide grants to local governments facing shortfalls. The amendment makes no mention of how cities and counties should fill the expected gap, according to the report.
Ken Rios, a tax principal at law firm Kaufman Rossin in Fort Lauderdale, cautioned that the measure "looks favorable but there's more to" it. As Private Real Estate Daily previously reported, Tax Foundation analysis found the amendment would cut the local property tax base.
The 5% cap would take effect next year if the measure passes, applying to commercial buildings and secondary homes while the homestead changes phase in through 2028.
Revenue loss to local governments more than doubles by 2032
Estimated loss of local government revenue by year, $B (2032 estimated at nearly $12B)
Show as table
| Label | Value ($B) |
|---|---|
| 2027 | $4.6B |
| 2028 | $8.4B |
| 2032 | $12B |
Reported by the Sectors desk from Commercial Observer. Published . Corrections