Home News Homebuyers Who Fled to Florida to Escape Taxes Are Aghast at Tax Bills

Homebuyers Who Fled to Florida to Escape Taxes Are Aghast at Tax Bills

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  • Florida law limits property taxes for existing homebuyers to 3% annually.
  • But new homebuyers are paying thousands more than previous homeowners.
  • The tax bill came as a shock to some who might have to consider moving out of state.

Earlier this year, 59-year-old Eugene Bednarski thoughtlessly paid a regular $1,600 property tax in Pasco County, Florida, north of Tampa on the state’s west coast.

But there was a surprise in the mail that arrived in May. A new bill showing the tax liability for the house was more than three times his original amount.

After getting over the initial shock, Bednarski realized the new bill was wrong. The government thought that the property was being traded and therefore deserved a higher valuation. In fact, the change in title of the house was due to a divorce, not a sale, so that fixed the issue.

“I would have been cheating on $5,000 a year,” Bednarski told Insider.

But many Floridians aren’t so lucky.

Property tax increases are controversial throughout the Sunshine State. flocked to Florida to escape for the past few years Exorbitant taxes in other states. Unlike Bednarski, most of the time they have no choice but to fight with local authorities over higher bills. Some people regret moving in the first place because of the unexpected costs, while others plan to sell their newly acquired homes and move out of state.

Anyone who bought a property in Florida in 2022 will be in the same situation next year. An analysis of state data shows that Florida’s overall assessed home prices are up 26% from 2021 to 2022, and those buyers outnumber previous home owners. A thousand dollars could be as much as property taxes owed.

In the Sunshine State, property tax increases will have a major impact on first-time homebuyers and those moving from other states. This is due to state constitutional amendments enacted in the 1990s called “Save Our Homes” that limit local property taxes for existing homeowners to 3% annually, or if the consumer price index is below his 3%. Because the case has changed. The cap also applies to existing Florida homeowners who move to a new primary residence anywhere in the state.

The goal of the move was to make life affordable in Florida, according to residents and experts familiar with the law.

Over the past three years, the percentage of taxes exempted from uncapped tax increases has declined, according to data from the Florida Department of Revenue. This is probably due to the new influx of immigrants to Florida. In high tax states like New York and California,

People are moaning about the tax bill they didn’t expect

Meanwhile, anger over the tax hike is flooding the airwaves and social media.

Earlier this year, Broward County resident Robert Walsh saw taxes on his Fort Lauderdale duplex skyrocket from $5,000 a year to $13,000 a year. CBS reported.

People are also taking out their anger on a 13,500-person Facebook group for people moving out of Florida, with one member claiming property taxes skyrocketed from $3,800 to $8,200. If he couldn’t get the taxes to come down, he was considering “selling the house” and “moving a little further north,” the person wrote, who did not respond to an insider’s request for comment.

Matt Simmons, managing partner of Fort Myers-based appraisal firm Maxwell Hendry & Simmons, which helps homebuyers appeal appraisals, said that because people own homes in Florida, He said he could regret it unless he properly researched the cost of

“That can make a big difference to someone’s taxpayer who just sold to a new buyer’s next taxpayer,” Simmons told Insider. is enough.”

Corporate home buyers are also hit with higher tax bills

Large homebuyers with abundant resources are also caught off guard.

Invitation Homes, which owns more than 80,000 single-family rentals nationwide, said last month that taxes could rise as much as 8% in 2022, according to the company’s third Seeking Alpha record. Quarterly earnings call.

Arnie Friedman, chief financial officer of Invitation Homes, said in a phone call that valuations in Florida and Georgia are up an average of a staggering 30%.

“We are going to appeal more than ever, especially in these two states,” Friedman said.

Big investor concerns carry over to Texas, another state that has seen increased demand for housing during the pandemic.

American Homes 4 Rent, a firm that invests in single-family rental homes, has predicted property taxes in Lone Star State will rise by more than 20% after hearing “surprisingly disappointing news” about the company’s obligations. Christopher Lau said on the company’s third quarter earnings call:

Even after Texas passed a law in 2019 limiting the increase in property tax revenues for cities, counties and certain special districts, Lau said the bill surged.

Some local governments in Texas are calling for property tax increases to fund hurricane relief and more. Texas Tribune reported.

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