Florida has no state income tax, so counties, cities and school districts rely on property tax. For investors that makes property tax one of the biggest costs of owning a rental in South Florida, and the number most likely to decide whether a deal works.
How the bill is built
- The property appraiser sets the value. The Miami-Dade, Broward and Palm Beach County property appraisers value each property as of January 1 every year.
- Several local governments set rates. The county, the city, the school board and special districts each levy a millage rate. Combined, they are often close to 2% of taxable value in Miami-Dade and Broward.
- No homestead exemption on a rental. A home you own and live in gets a homestead exemption and a 3% cap on yearly increases in assessed value. An investment property gets neither.
The non-homestead cap, and Amendment 3
For non-homestead property, including rentals, the assessed value used for most levies can rise no more than 10% a year. School taxes are not capped. The cap resets when the property is sold, so a buyer is taxed on full market value starting the next January 1. Do not underwrite on the seller’s tax bill.
Florida voters approved Amendment 3 on November 3, 2026. It lowers the yearly cap on non-homestead property from 10% to 5% for non-school levies starting in 2027. That slows increases for owners who hold, but it does not change the reset on a sale.
Appealing your value
Each August the county mails a TRIM notice showing your proposed value and taxes. If the value is too high, you can talk to the property appraiser’s office, and you can file a petition with the county Value Adjustment Board within 25 days of the notice. Recent purchase prices, repair estimates and comparable sales are the usual evidence.
Paying the bill
Bills go out around November 1 and are due by March 31, with a discount of up to 4% for paying in November. On a rental loan, taxes are usually paid from an escrow account.
How it affects a loan
| Item | Monthly |
|---|---|
| Rent | $3,600 |
| Principal and interest | $2,050 |
| Property tax at 2% on $450,000 | $750 |
| Windstorm, property and flood insurance | $450 |
| Total payment | $3,250 |
| DSCR | 1.11 |
Taxes and insurance together can be more than a third of the payment, which is why we use full market value, not a homestead or capped figure, when we size a DSCR rental loan.
Common questions
No. The homestead exemption is only for a home you own and live in as your permanent residence.
The assessed value of non-homestead property can rise no more than 10% a year for non-school levies, falling to 5% starting in 2027 under Amendment 3. It resets when the property is sold.
File a petition with the county Value Adjustment Board within 25 days after the TRIM notice is mailed in August. You can also ask the property appraiser’s office to review the value informally.