Florida's Property Tax Elimination Proposal: What Out-of-State Buyers Need to Know

If you've been watching Florida from afar and wondering whether now is the time to make your move, you may have just seen a headline that caught your attention: Florida's Governor is proposing to eliminate property taxes on homesteads.

It's a big claim. And like anything this significant, the reality is a little more nuanced than the headline suggests. As a Central Florida Realtor who works primarily with relocating families and out-of-state buyers, I want to break this down clearly — no spin, no politics — just what it actually means for someone considering a home purchase in Florida.

What's Actually Being Proposed

On May 27, 2026, Governor Ron DeSantis announced the "Save Our Homes from Excessive Property Taxes" plan and called a special legislative session beginning June 1 to consider it.

Here's what the proposal actually contains:

The plan starts by raising the homestead exemption from $50,000 to $250,000 immediately. That alone would eliminate property taxes entirely for roughly 60% of Florida homeowners. The Legislature would then be required to set a schedule for full elimination, with an eventual exemption ceiling of $500,000 covering about 92% of homesteaded properties.

How This Would Actually Happen

This isn't a law that takes effect next month. Here's the path it has to travel before it becomes reality:

There's also a significant political hurdle. The Florida House passed a similar proposal earlier this year, but it failed in the Senate due to concerns about the impact on local government budgets. DeSantis has sided with a more measured approach, but the Legislature is not fully aligned. This is still very much a proposal, not a done deal.

What It Means for Out-of-State Buyers

This is where it gets interesting for you specifically. If you're moving to Florida from a high-tax state — think New York, New Jersey, Illinois, California, Massachusetts — you're probably already doing the math on how much you'd save.

Let's look at what this could mean in real numbers. In Central Florida, property tax rates typically run between 1% and 1.5% of assessed value depending on the county and school district. On a $400,000 home:

• Current law: You pay taxes on roughly $350,000 (after the $50,000 homestead exemption) — approximately $3,500–$5,000/year depending on your exact location.
• Under the proposed $250,000 exemption: You'd pay taxes on only $150,000 — approximately $1,500–$2,250/year. That's a savings of $2,000–$3,000 annually.
• If the exemption rises to $500,000: A $400,000 home would be fully tax-free.

The Catch: You Have to Actually Live There

There's an important provision in this proposal that every relocating buyer needs to understand. To qualify for the increased homestead exemption, you must establish Florida as your primary residence. And here's the part that surprises some people:

The proposal includes a fairness clause requiring that anyone who establishes Florida residency after January 1, 2027 must maintain that residency for up to five years before qualifying for the full increased exemption. This is designed to prevent people from claiming the exemption without making a genuine long-term commitment to the state.

In other words: if you move to Florida, buy a home, and genuinely make it your primary residence, you're in great shape. If you're thinking about buying a vacation home or investment property and calling it a primary residence — that strategy has some real legal risk attached.

What About the Money for Roads, Schools, and Services?

This is the question serious buyers should ask, because it affects the quality of the communities you're moving into. Property taxes fund local services — schools, fire departments, roads, parks, and infrastructure.

The proposal does address this. It requires local governments to use remaining property tax revenue solely for core public services including public safety, education, infrastructure, and natural resources. It also establishes a state trust fund to provide grants to local governments to offset lost revenue.

However, critics — including the Florida Association of Counties — have raised legitimate concerns. As their deputy director put it, eliminating property taxes doesn't eliminate the cost of emergency response, infrastructure, and essential local services. The funding gap has to come from somewhere, whether that's other taxes, state transfers, or reduced services over time.

Should This Change Your Buying Timeline?

Here's my honest take as a Realtor: No, it probably shouldn't.

Here's why. This proposal still has to pass the Legislature, go to voters in November, clear a 60% threshold, and then be phased in over time. That's a long runway, and there are legitimate political obstacles at every step. It's possible this doesn't pass at all, or that it passes in a significantly modified form.

What I'd caution against is waiting to buy based on a tax change that isn't guaranteed. The Central Florida market is already favorable for buyers right now — inventory is up, rates have come down from their peak, and sellers are more willing to negotiate than they've been in years. Waiting six to twelve months for a ballot outcome means potentially missing that window.

On the other hand, if you were already planning to move to Florida and this proposal pushes you over the edge — great. The fundamentals are solid regardless of what happens with property taxes.

The Bigger Picture for Florida Buyers

Florida already offers a compelling tax picture for people moving from high-tax states. There's no state income tax. Property taxes are already lower than most of the Northeast and Midwest. Homestead exemptions already provide some protection.

If this proposal passes, it adds another significant layer of savings — particularly for buyers purchasing homes under $500,000, which is the majority of the Central Florida market. That's meaningful. A family saving $3,000–$5,000 per year on property taxes over a 10-year period is looking at $30,000–$50,000 in cumulative savings.

For an out-of-state buyer comparing the total cost of ownership in Florida versus their current state, that's a number worth including in your analysis — as a possibility, not a guarantee.

What to Watch For

Here are the milestones to track if you want to follow this closely:

• June 1 week: Special legislative session — will the Legislature approve putting this on the ballot?
• Summer 2026: If approved, voter education and campaign period begins
• November 2026: Florida voters decide — 60% threshold required
• Early 2027: If passed, implementation details finalized

My Bottom Line

This proposal is genuinely significant — potentially historic, if it passes. Florida eliminating property taxes on primary residences would make it the only state in the country with neither a state income tax nor property taxes on homesteads. For anyone considering a long-term move to Florida, that's a powerful combination.

But it's not a done deal. Buy in Florida because the lifestyle, the market, and your financial situation make sense right now. If the tax proposal passes on top of that, it's a bonus — a very meaningful one.

If you're thinking about making your move to Central Florida and want to talk through how this — or any other factor — fits into your decision, I'm happy to have that conversation. No pressure, no pitch. Just a straightforward look at what buying in this market actually looks like for your situation.