The Save Our Homes Amendment, which was passed in 1993, was put in place to limit changes in home valuations for full-time homesteaded residences.  The purpose of this amendment was protect Floridians from being taxed out of their homes as values increased over time.

This amendment did not protect part-time snowbirds from valuation increases and their properties adjusted in value every year with the market.  The effect of this was that snowbirds were paying significantly higher taxes for like properties even though they are part-time residents.

The Save Our Homes Amendment also limits downward reductions in home valuations to 3% annually for homesteaders.  Non-resident valuations have dropped with the market, but residents are capped, creating a scenario where the snowbirds are seeing huge reductions while full-time residents are not.  It is rather ironic that the designers of the Save Our Homes Amendment must have never envisioned a scenario where property values would drop as dramatically as they have over the past few years.

Hopefully the taxpayers of Florida will collectively move to repeal this unfair tax act and normalize the valuations of all Florida property.

Over the past few years, I have been rather critical of the Save Our Homes Amendment as I have historically believed that it placed an unfair burden on the lifeline of Southwest Florida……..second home owners.

It has always seemed very unfair to me that second homeowners, who were down here on a seasonal basis and not using resources like our schools, were being penalized because they didn’t qualify for a homestead exemption.   These second homeowners have had very little power to change this inequity as they are not residents, don’t vote and are not represented in Tallahassee.

With the drastic reduction in home values throughout our region, the Homestead Act is now penalizing homesteaders as their valuation reductions are capped at a maximum of 3%.  It will be interesting to see if these penalized homesteaders can generate enough of a voice to repeal this unfair act and and  bring normalcy to Florida real estate valuations.

The Bristol Press covers this issue in a column titled, Should “snowbirds” change state residency? Although this article is written by a Connecticut attorney referring to Connecticut laws, the main themes in the article are applicable to all Florida second homeowners considering whether or not to establish residency.

One relevant issue not fully explored in the column is the property tax benefits in Florida associated with the Save Our Homes amendment. Significant property tax savings are available to residents of Florida for their primary home. The absence of state income tax in Florida is another important issue to consider when considering a change of residency.

The Fort Myers area is home to several 55+ active adult communities that especially popular with second home owners.

Falconer presents compelling analysis of the long-term effects of the Save Our Homes Amendment on the Florida economy. The article describes Save Our Homes as a tax shift rather than a tax limit. Save Our Homes shifts the tax burden from voters who would be motivated to limit government spending to those that don’t have a vote like second home-owners.

The article does a fine job of describing the effects of the Save Our Homes laws on those that it negatively effects, (1) second homeowners, (2) apartment renters and (3) small business owners. It is time for political leadership with the intestinal fortitude to do the right thing to step forward and fix this mess.

The Socialist Republic of Florida, Chapter One [American Chronicle]

The Sarasota Herald-Tribune recently featured a fascinating series on the controversial Save our Homes Amendment, which caps annual property tax increases at 3% for homestead residents. This amendment shifts a disproportionate amount of the tax burden to second home owners and businesses.

Many existing homeowners that benefit from the amendment are feeling trapped because they do not want to sell their homes and trigger a major tax increase. There is a growing call to add a portability option to this amendment. The challenge for political leaders will be to drive reform without creating revolt among homestead taxpayers.

Save Our Homes Special Report [Herald-Tribune]

A Herald-Tribune article reveals that many homeowners want to move but are staying put to avoid a major tax increase associated with a new home appraised at the current market value. In Florida, as a result of the Save Our Homes Amendment, tax increases for primary residences are limited to three percent a year.

While this tax limitation does protect low income individuals from losing their homes, it has created a serious tax inequality problem across the State of Florida. A major portion of the tax burden is falling on newcomers and first home buyers that are taxed at market rate.

In the long run, this inequality will hamper the real estate industry in Florida if the tax burden is not more equally distributed. Tough to imagine very many politicians would be willing to take on the burden of fixing this one.

Homeowners feel trapped by taxes [Herald -Tribune]

In 2001, a hitman gunned down Miami Subs founder Konstaantinos “Gus” Boulis in a gangland-style slaying on the streets of Fort Lauderdale. His murder made national news, was featured in a book and joined mafia lore as an unsolved murder mystery.

Away from the limelight, however, no one noticed that a waterfront home in the name of a dead man was still receiving a homestead break. The illegitimate homesteading tax benefit lived on until this year. It saved his estate — and cost Broward County taxpayers — thousands in taxes on the $1.25 million waterfront home.

The case is not unique.

Homestead cheaters rob millions in taxes [Herald-Tribune]