Florida Housing Market – A home for sale in St. Augustine, Florida, USA. Photo: Paul Brennan/Shutterstock.com
Some local governments are considering eliminating property taxes to ease financial pressures on homeowners.
Florida Governor Ron DeSantis recently suggested on social media that he would be open to abolishing these taxes statewide, though he acknowledged that doing so would require a constitutional amendment.
According to Joel Berner, a senior economist at Realtor.com, such a change could provide a short-term boost to Florida’s housing market by helping clear the surplus of available properties.
Reducing or removing property taxes could relieve some financial strain for homeowners, who are already dealing with high housing expenses, including rising insurance rates. Berner also noted that this change might encourage more people to relocate to Florida.
Currently, the state has a growing inventory of unsold homes, and properties are taking longer to sell due to affordability concerns. Many homeowners who have enjoyed historically low mortgage rates are now considering selling, but demand has cooled compared to the state’s previously booming market.
“Eliminating property taxes would effectively increase homebuyers’ budgets, potentially allowing them to purchase their first home, upgrade to a larger one, or afford a dream home that was previously out of reach,” Berner explained.
However, he also cautioned that this change could create a surge in demand, pushing housing market home prices higher in the short term.
There are potential drawbacks as well. Removing property taxes could impact local communities by reducing their ability to generate revenue independently.
“If local property taxes are replaced by a higher state sales tax, cities and school districts may lose some control over their funding, limiting their ability to address specific community needs,” Berner said.
He added that different municipalities have unique financial requirements, and a centralized state tax system might not adequately meet them.
Chen Zhao, an economic research lead at real estate firm Redfin, echoed similar concerns. Zhao pointed out that eliminating property taxes could create ripple effects, as potential homebuyers might worry about reductions in local services like education, which could counteract any benefits of removing the tax.
Another major uncertainty is how the state would replace the lost revenue.
If Florida offsets the loss by increasing sales taxes, Zhao noted, it could deter potential new residents rather than attract them.
Additionally, the ongoing challenge of rising insurance costs remains a concern.
“If insurance premiums continue climbing due to increasing climate risks, any savings from lower property taxes might be negated, causing buyers to hesitate about purchasing in Florida,” Zhao said.
Florida isn’t alone in exploring this idea. Some fiscally conservative lawmakers in other states have also proposed eliminating property taxes.
For instance, a Pennsylvania legislator recently argued that homeowners shouldn’t have to feel like they are paying “rent” to the government.
“Property taxes aren’t strictly a partisan issue—how much they impact residents depends on the area,” said Representative Russ Diamond of Lebanon, Pennsylvania.
“My main concern is ensuring that people can truly own their homes without feeling like they are perpetually renting from the government,” he added.
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Chris began his writing as a hobby while attending Florida Southern College in Lakeland, Florida. Today he and his wife live in the Orlando area with their three children and dog.
