TALLAHASSEE — Florida homeowners could see their property values surge if Gov. Ron DeSantis’ bold proposal to eliminate property taxes on owner-occupied homes becomes reality, according to economists who say the move would make houses more attractive to buyers by slashing long-term costs.
The governor is looking for ways to ease the financial burden on residents amid rising insurance premiums and inflation, and floated the idea last month as part of a broader tax reform package. DeSantis argued that scrapping the levies — which fund schools, local governments, and other services — would put more money back in Floridians’ pockets and stimulate the housing market.
Experts say it’s all about a simple economic idea: Property taxes get baked right into what homes sell for. Basically, when people are figuring out their max bid, they factor in recurring costs. If you ditch the yearly tax hit—around $2,338 on average for a standard Florida house—buyers suddenly have more room in their budgets to push offers up, spiking property values pretty much instantly.
“If you remove that recurring cost, it’s like adding to the home’s net worth,” said David Berner, an economist at the University of Miami who modeled the potential impacts. His analysis suggests values could jump by about 7% statewide if all property taxes on homesteads were eliminated. This could translate into tens of billions of dollars in additional equity for current owners. In high-tax areas like Miami-Dade or Broward counties, the spike might reach 9%, Berner added, based on current millage rates.
Partial elimination offers a glimpse of the effect. Research shows that axing just the non-school portions of property taxes — about half the total in many districts — could lift values by 4% to 5.5%, or roughly $110 billion to $150 billion across Florida. That’s because buyers calculate the present value of future savings: For a $400,000 home, ditching a $4,000 yearly tax might justify paying an extra $50,000 or more upfront, assuming standard discount rates.
Florida’s real estate scene is already on fire thanks to folks fleeing those pricey tax states, pushing median home prices to $410,000 so far this year—a solid 5% jump from last year. Still, staying affordable is tough, especially for new buyers getting hammered by high interest rates on loans. DeSantis’s proposal is supposed to help fix that mess, but some folks say it might just make the divide even wider.
“Home values go up, sure, but that benefits sellers and current owners more than newcomers,” said Sarah Jenkins, a policy analyst at the Florida Policy Institute. She noted that renters, who make up about a third of the state’s households, wouldn’t see direct relief and might face higher rents as landlords pass on any savings or losses from reduced public funding.
The proposal faces hurdles in the legislature, where lawmakers must grapple with replacing the $20 billion-plus in annual property tax revenue. DeSantis has suggested sales tax hikes or other offsets, but details remain sparse.
Berner’s research showed that even specific tweaks, like beefing up homestead exemptions, have typically been linked to property value bumps of 2% to 3% in the spots they hit. Florida’s “Save Our Homes” limit is already protecting many folks from sharp tax hikes, since it caps annual assessment increases at just 3% for primary residences. But wiping out the tax completely would amp up that safety net big time.
As the 2026 legislative session approaches, the debate is heating up. Proponents see it as a path to true homeownership freedom. However, opponents fear slashed services, such as education and infrastructure. Either way, the potential windfall for property values is hard to ignore.
