Florida House Price Warning Issued Over Plan to Eliminate...

By Giulia Carbonaro

Senior Housing Reporter

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Home prices in Florida would “immediately” jump by about 7 percent to 9 percent if the state was to completely eliminate property taxes, as Governor Ron DeSantis has repeatedly said lawmakers should do, according to new analysis by Realtor.com.

Why It Matters

Florida is among several Republican-led states trying to either abolish or drastically slash property taxes this year to offer relief to homeowners struggling with higher housing costs.

In the years following the start of the pandemic, property taxes rose all across the country in response to a surge in home values, together with home prices, borrowing costs, and homeowners' insurance premiums. The result is the current housing affordability crisis that is plaguing the nation.

While eliminating property taxes would be a welcome change for some homeowners, especially those who bought their properties at the height of the pandemic, higher home prices will exacerbate the problem of affordability facing millions of Americans.

What To Know

For months, DeSantis has been calling for state lawmakers to pass legislation that would eliminate property taxes in the state, which he described as “the more oppressive and ineffective form of taxation.”

In May, he wrote on X: “Truly owning private property should not mean perpetually paying rent to the government. I’m committed to reducing—and ultimately eliminating—property taxes for homeowners in Florida.”

But several experts have responded with skepticism and concern about this proposal. Dr. Esteban Leonardo Santis, director of research with the Florida Policy Institute, told Newsweek that Florida “cannot afford” to eliminate property taxes, and would likely need to increase the sales tax to make up for lost revenues.

“Any of these proposals are cost shifts, they’re going to shift the cost,” Santis told Newsweek.

“So the question right now is who is going to pay for it? A lot of the conversation, some of the conversation has been, can the local governments pay for it? But ultimately, if you’re talking about a full elimination…you’re looking at either increasing the sales tax through percentages or having to find other ways, whether it’s increased fees at the local level, new taxes at the local level, or really service cuts,” he said.

Now, Realtor.com experts are also saying that eliminating property taxes would immediately increase home values in the state, in a way that would benefit homeowners—boosting the aggregate value of Florida’s owner-occupied housing stock by about $200 billion to $250 billion—but harm future first-time buyers.

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What People Are Saying

Realtor.com senior economist Joel Berner, commenting on the idea of eliminating property taxes in Florida: “It would be a boon to existing property owners. But this measure would disproportionately benefit wealthy Floridians at the expense of those who don't own homes, and would make it even harder to break into homeownership because of the increased prices.”

Ken Johnson, a housing economist and the Christie Kirkland Walker chair of real estate at the University of Mississippi, told Realtor.com: “As long as we are in a prosperous economic time, not in a recession, all of this is going to work fine. The risk that Florida is exposed to is that once we hit a recession, we’re probably going to see an excess supply of homes go on to the market.”

In the case of a national recession, Johnson said, Florida could see an uptick in the sale of vacation homes, which account for around 10 percent of the state’s housing stock, which would cause a glut that would bring prices down.

“The ‘black swan’ event becomes: recession has hit. Real estate prices are going down. So are tourism dollars. So is taxation from out-of-state homeowners with either short-term rentals or second homes. A major U.S. recession could crash Florida housing and, at the same time, dry up the Florida budget,” he said.

What Happens Next

Realtor.com specified that the exact impact of Florida’s property tax reform on home values would depend on the specifics of the plan approved by voters next year, “as well as any unforeseen impacts on supply or demand.”

Florida lawmakers do not seem willing to go ahead with DeSantis’ plan to completely eliminate property taxes in the state at the moment.

In October, they came up with eight potential solutions to lower the property tax burden on Florida homeowners, seven of which would appear on the 2026 general election ballot. One bill would eliminate tax on non-school homesteads.

While DeSantis has criticized lawmakers for the multitude of bills, saying it is “not a serious attempt to get it done for the people,” Florida House Speaker Daniel Perez hit back at the governor, saying he has not presented a plan himself for eliminating property taxes in the state.

Jeff Brandes, a former state senator and founder and president of the Florida Policy Project, agrees. Last month, he told Newsweek that the idea of eliminating property taxes is not a real policy but a “bumper sticker” for the governor, who likely wants to use it to jump-start his campaign for the 2028 presidential election.

Eliminating property taxes in Florida would require a constitutional amendment backed by 60 percent of voters.

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