The pending change to Florida property taxes will be a boon for homebuilders and developers.
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This November, Florida voters will decide on a constitutional amendment that could reshape the economics of residential development in our state for a generation. As someone who has spent a career studying Florida’s housing markets, I want to cut through the political noise and focus on what HJR 1-F actually means for two groups that build the roofs over our heads: homebuilders and rental developers. The answer is more nuanced—and more divergent—than the bulk of the headlines suggest.
Background: The $250,000 Question
In June 2026, the Florida Legislature passed House Joint Resolution 1-F, “Save Our Homes from Excessive Property Taxes,” sending it to the November 2026 ballot. Because it amends the state constitution, it bypasses the Governor’s desk but must clear a 60% voter-approval threshold, and would take effect January 1, 2027.
Here is what it does if passed:
Creates a “super” homestead exemption on the non-school portion of property taxes—$150,000 starting January 1, 2027, rising to $250,000 on January 1, 2028, and indexed to inflation thereafter.Reserves the full benefit for established Floridians; anyone who establishes residency after January 1, 2027, must maintain Florida residency for five years before receiving the increased exemption.Lowers the annual assessment-increase cap on non-homestead property (rentals, commercial, second homes) from 10% to 5%, beginning January 1, 2027.Directs local governments to prioritize remaining revenue for core services—public safety, infrastructure, flood control, and debt service.
A critical point often lost in the conversation: this is not the full elimination the Governor has floated. School levies remain untouched, and only the non-school portion of homeowner taxes is affected.
Timing Is Everything: The 2026 Mover vs. the 2027 Mover
Here is a wrinkle that hasn’t gotten enough attention, and it matters enormously for anyone marketing Florida homes to out-of-state buyers. The amendment draws a hard line on residency timing.
Consider two identical families relocating from, say, New Jersey:
The 2026 mover establishes Florida residency on or before December 31, 2026. When 2027 Trim notices arrive, this family is treated as an established homesteader and steps directly into the expanded exemption—$150,000 in 2027 and $250,000 in 2028. On a typical home, that can mean thousands of dollars in annual savings essentially from day one.The 2027 mover establishes residency after January 1, 2027, and must maintain Florida residency for five years before qualifying for the increased exemption. During that waiting period they receive only the standard homestead treatment—paying materially more in non-school taxes than their neighbor who arrived just months earlier. This mover does of course enjoy the benefit after the five years have elapsed, and that is still significant.
Two otherwise identical buyers, separated by a single move-in date, can face dramatically different annual carrying costs for years. For a relocating household running the numbers, becoming a Florida resident before year-end 2026 is worth real money, IF this constitutional amendment passes.
Folding That Into the Homebuilder Story
For Florida’s homebuilders, the amendment is, on balance, a meaningful demand-side positive—and the residency-timing rule sharpens that story considerably.
When you reduce the recurring cost of homeownership, you increase what a buyer can afford to pay for the home itself. Realtor.com’s economics team estimated that eliminating property taxes on owner-occupied homes would lift statewide values 7%–9% almost immediately; a partial, non-school-only cut would land more modestly, around 4%. Either way, lower ownership costs get capitalized into price.
The 2026-versus-2027 dynamic adds a time-sensitive marketing catalyst on top of that:
A closing-velocity tailwind through year-end 2026. Builders with standing inventory or quick move-in product have a powerful, legitimate pitch to relocators: close and establish residency before December 31, 2026, and you capture the full exemption immediately rather than waiting five years. Expect savvy sales teams to build entire campaigns around the deadline.A demand “air pocket” risk in early 2027. The flip side is that pulling relocator demand forward can leave a softer patch for out-of-state buyers who miss the window and now face a five-year wait for full relief. Builders should model that potential 2027 lull in their absorption schedules rather than assuming straight-line demand.Pricing-power headroom. If existing-home values rise on the tax relief, new construction gains room to price alongside them—strongest in entry-level and move-up segments where qualifying ratios are tight.
The honest caveat every economist must state: a lower tax bill does not automatically make homes cheaper to buy, because the savings tend to be capitalized into higher prices. The affordability win for the buyer is partially offset—while the value win for the builder and existing owner is real.
The More Complicated Calculus for Rental Developers
For rental and build-to-rent developers, the picture is genuinely mixed.
The headline exemption does not apply to rental properties—those are non-homestead and receive no super exemption. Instead, the relevant lever is the assessment cap dropping from 10% to 5%. On paper that is a benefit: it slows the growth of taxable assessed value over a hold period, improving NOI predictability and protecting against the reassessment shocks that have battered Florida multifamily underwriting in recent years.
There is also a subtle demand upside from the residency rule. The five-year waiting period gives relocating households a strong reason to rent first while they establish residency and run out the clock toward the full homestead benefit. Well-located BTR and multifamily product can capture exactly that bridge demand.
But the headwinds are real:
An uneven playing field versus for-sale product. Homeowners get a transformational exemption; rentals get only a modest cap reduction—widening the cost-of-occupancy gap between owning and renting.The affordable-housing interplay. Operators using the Live Local Act already access 75%–100% property tax exemptions on qualifying units, so the cap change is marginal for them.The revenue-shift threat (more below). As homeowner relief shrinks local budgets, the burden may tilt toward non-homestead property, including rentals.
The Fees Catch: How Local Governments Backfill—and Mute the Savings
Here is the part that should temper everyone’s enthusiasm. Property taxes fund the bulk of local services, and replacing that revenue is not optional. One analysis estimated Florida governments would need to raise roughly $2,015 per capita to fully replace lost property-tax revenue, and microsimulation work confirms substantial fiscal effects on municipalities.
When the millage spigot is constrained, local governments turn to the other tools in the home-rule toolbox—and most of them land back on residents and developers:
Impact fees. These are already a significant cost of housing in Florida, and the Legislature explicitly treats them as an important infrastructure-funding source. Higher impact fees raise the cost to build a home, which builders pass through in pricing—directly muting the consumer’s tax savings.Special assessments and service fees. Counties and cities can lean on fire assessments, stormwater fees, and similar non-ad-valorem charges that fall outside the homestead exemption entirely, quietly clawing back part of what the tax cut gives.Higher non-homestead millage. Because rentals and commercial property don’t receive the super exemption, they are an obvious target for rate increases to backfill budgets—a direct risk to multifamily NOI.
The net effect: a homeowner may see a headline tax cut on the Trim notice, only to absorb much of it back through new or higher fees baked into the price of the home and the cost of local services. The amendment changes who writes the check and what it’s called—it does not eliminate the underlying cost of running a county.
The implications for developers of single-family subdivisions versus apartment/BTR developers.
Hunter Housing Economics
The Bottom Line
If passed, HJR 1-F is most clearly bullish for the for-sale side: lower carrying costs get capitalized into values, the buyer pool widens, and the year-end 2026 residency deadline hands builders a genuine, time-limited selling catalyst. For rental and BTR developers, the story is muddy—a helpful assessment cap and real “rent-first” bridge demand on one hand, structural revenue-shift risk on the other.
This constitutional amendment may not pass, but the smartest operators, builders, and developers won’t wait for November to plan for the contingency. They’ll market the 2026 residency window aggressively, model a possible 2027 demand air pocket, stress-test pro formas under both stable- and rising-fee scenarios, and watch how individual counties signal their backfill intentions. As always in Florida real estate, the constitution sets the rules—but the local taxing authorities, armed with impact fees and assessments, will ultimately decide who pays.