Florida Amendment 3 passed: what the 5% assessment cap means for landlords

Florida voters approved Amendment 3 on Nov. 3, with 62% of the vote and 95% of ballots counted, clearing the 60% bar a constitutional amendment needs. The headline is a much larger homestead exemption, which rental property does not get. For landlords, the change that matters is quieter: beginning Jan. 1, 2027, the cap on annual assessment increases for non-homestead property falls from 10% to 5% for non-school taxes.

That is good news on paper. Whether it lowers your tax bill depends on what cities and counties do to replace the revenue they are about to lose.

What happened

The results are unofficial until certified. WUSF, citing the News Service of Florida, also reported 62% support. Here is what the enrolled joint resolution, CS/HJR 1F, changes:

• Homestead exemption. The non-school exemption rises to $150,000 on Jan. 1, 2027 and $250,000 on Jan. 1, 2028, up from a maximum of $51,411 for the 2026 tax year. Only the first $25,000 still applies to school taxes. People who were not Florida residents as of Dec. 31, 2026 get a $50,000 non-school exemption until their fifth year of exemption, when the larger one applies.
• Non-homestead cap. The resolution treats two groups separately: residential property with nine units or fewer, and all other non-homestead property, which covers larger apartment buildings and commercial real estate. For both, the cap on non-school assessment increases is 10% before Jan. 1, 2027 and 5% beginning that date.
• Resets. Small residential property (nine units or fewer) is reassessed at just value after a change of ownership or control, including a change of ownership of the legal entity that owns it. For the larger group, the Legislature "must" require a reset after a qualifying improvement and "may" require one after an ownership change; current state law, s. 193.1555(5), Fla. Stat., already does both.
• Spending limits. County and municipal property taxes may be used only for a closed list of purposes, including public safety, schools, infrastructure, flood control, debt and pensions, and general government operations.

The cost to local budgets is large. The state Revenue Estimating Conference projected a $4.95 billion shortfall in non-school property taxes in the first year, rising to $11.86 billion by fiscal 2031-32. Orange County alone estimates it will lose about $165 million in 2027 and $275 million in 2028. The changes first show up on August 2027 TRIM notices and the tax bills delivered in November 2027.

Why it matters for property managers

The cap limits assessed value, not your tax bill. The Pinellas County Property Appraiser puts it plainly: the move from 10% to 5% caps assessed value, not taxes, and school taxes stay uncapped and based on just value. Your bill is still taxable value times the millage rate, plus any non-ad valorem assessments and fees, which the appraiser notes can also change.

Local governments will look for the money somewhere. Orange County's explainer says that because rental and commercial property does not get the new exemption, those owners could face higher tax burdens that may be passed on to tenants, and that counties would likely consider spending cuts, fees and other legally allowed revenue. Bisnow made the same point: non-homesteaded rentals could see property taxes rise.

Rate increases may get harder. Orange County's summary of the package (the joint resolution plus the companion general bill, SB 4F) says the default maximum millage would be narrowed to the rolled-back rate, with up to 110% of that rate needing a two-thirds vote of the governing body and anything higher needing a unanimous vote. That makes a large rate increase harder, not impossible. Confirm the final terms with your county before you rely on them.

The 5% cap only matters in a rising market. If a property's assessed value would not otherwise rise more than 5% in a year, nothing changes. That includes a flat market for a property already assessed at just value. But a parcel whose assessed value is already below just value could catch up by up to 10% a year under the old cap, even in a flat market, and now only 5%. The benefit builds over time as assessed value falls further below just value.

Acquisitions get a bigger tax jump. Because a sale of a small residential property resets its assessment to just value, a slower-growing cap means a wider gap between what the seller pays and what you will pay. If you are buying a one-to-nine-unit rental in 2027 or later, underwrite taxes at just value, not at the seller's bill. For larger buildings, current state law already resets assessed value to just value after a sale or change of ownership or control, so underwrite those at just value too.

What to do this week

1. Inventory your Florida parcels. For each one, pull just value and assessed value from your 2026 TRIM notice or the county appraiser's site, and note which cap group it falls in (nine units or fewer, or everything else).
2. Rebuild the 2027 and 2028 tax line. Model non-school assessed value growing at no more than 5%, school taxes on full just value, and a separate line for new fees or special assessments. Do not book savings until 2027 millage rates are set.
3. Re-underwrite pending deals. Price post-closing taxes at just value for small residential, and assume a reset for larger properties as well, since current law already provides one after a change of ownership or control.
4. Read your pass-through clauses. Commercial leases with tax escalations will move with whatever counties do. On residential renewals, do not cite Amendment 3 to justify an increase you cannot document; rent changes still follow your lease and state and local law, so confirm with local counsel.
5. Calendar the 2027 budget hearings. Cities and counties set rates in late summer 2027, after the August TRIM notices. That is when to speak up on fees and assessments, and to prepare value adjustment board petitions if your August 2027 TRIM notice looks wrong.

What we're watching

• Certification of the statewide results.
• Implementing legislation. The Pinellas appraiser says administrative details may come through implementing legislation and exact savings cannot be calculated until it is final. The Legislature could also revisit the existing statute that resets larger properties' assessments after a sale.
• New fees and assessments in 2027 local budgets, especially in counties that lean hardest on property tax.
• Renter demand. Bigger homestead savings shift the rent-or-buy math for some Florida households, while new residents wait five years for the full exemption. Watch for that in 2027 leasing data before you reprice anything.

This is general information, not legal or tax advice. Check your county property appraiser's guidance and your tax adviser before changing budgets or leases.