ORLANDO, Fla. – Hundreds of people move to Florida every day, and while Florida’s real estate market may not be as hot as it once was, housing prices in Central Florida, at least, are still higher than they should be, according to housing experts.
If you’re in the market for a new home in Florida, property taxes may be one factor in what you buy. If it is, be warned: the price you see on real estate websites like Zillow or Realtor.com is not necessarily the price you’ll pay.
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The reason? Florida’s homestead exemption laws.
“How many people realize the homestead exemption exists? Because folks are coming from everywhere, all over the world,” said Orange County Property Appraiser Amy Mercado. “Homestead doesn’t exist in certain jurisdictions, right, in countries, and so it is a constant educational process for our office; all of our outreach always includes some level of homestead education because they don’t realize it even exists. Even from, you know, state to state, they don’t handle it the same way. They don’t offer the same things.”
Florida’s homestead rules exempt portions of a residential property’s value, which in turn reduces the tax bill.
Say a house has an assessed value of $100,000. In Florida, the property is taxed like this:
- First $25,000 – tax-exempt (first exemption)
- $25,000-$50,000 – taxed
- $50,000-$75,000 - exempt from all ad valorem taxes except school taxes (second exemption)
- $75,000-$100,000 - taxed
All property values after that $100,000 would also be taxed unless you qualify for another exemption. There are exemptions for active duty military members and veterans, for people 65 and older, for people with certain disabilities, and for surviving spouses of a first responder who died in the line of duty. You can find all the exemptions on the Florida Department of Revenue website HERE.
Florida also has a homestead exemption rule known as Save Our Homes. This caps a property appraiser’s assessment of a home at a 3% increase in value, or the percent change in the Consumer Price Index, whichever is less.
It also allows people who have lived in a home for a long time and want to move to take the savings from the homestead exemption with them to a new home, allowing them to lower their tax assessment.
What happens to the taxes on the house you’re leaving? They get reset to current-day market value, according to Mercado.
“So, for example, if you live in your home for 10 years, you bought it for $100,000, you then live in it for the 10 years, and it’s worth $300,000,” Mercado said. “The savings between your market and your assessed value for those 10 years, you have the opportunity to take with you. The person that buys your home doesn’t pay the (tax) rate that you’re paying. You may be at $1,000… a year in taxes because of the years you’ve been in it. You bought it at $100,000, and it slowly progressed. That person is going to pay on the $300,000 mark because it resets as soon as you sell."
Let’s head to Zillow.com and break this down.
A home near News 6, on Lake Orlando Parkway, sold in 2025 for $535,000.
According to Zillow, the home’s property taxes in 2024 were $4,108. This matches the publicly available data on this house on the Orange County Property Appraiser’s website, indicating the person who bought the house had a homestead exemption from a previous property.
However, if you were to buy that house now, without a homestead exemption that you are transferring from another house? Your property taxes would be way more.
According to the Tax Estimator Tool on the property appraiser’s website, if you were to buy this same property today for $535,000 and apply for a new homestead exemption, your total tax bill is estimated to be $8,225.96 to $9,194.46.
Try it for yourself HERE. It’s free.
“What (the seller is) getting in their documentation, and it’s being disclosed appropriately, is based on the persons that are living in the property. So it’s not an apples-to-apples comparison,” Mercado said.
But that leads to a shock for a new homeowner, and a lot of frustration often directed at the property appraiser’s office.
“When they receive their first tax bill after the sale, with their reset rate, it’s at the current market value. And it could be a significant jump, right? It can be thousands of dollars that you’re not expecting, that you are not budgeting for,” she said.
Mercado says anyone looking to buy in Florida needs to find the property appraiser’s website for the property’s county. Every website has the same tax estimator tool that Orange County has.
Florida’s Department of Revenue website has a tool to help you find the right property appraiser HERE.
A bill in the Florida Legislature set out to address this issue. SB 856 would have prohibited online listing sites from using a current owner’s tax information, instead requiring the sites to calculate estimated property taxes with other methods.
The bill passed in the Florida Senate but never made it through the Florida House.