Amendment 3 seeks to lower taxes for second homes and investors. Will it?

Next week, Florida voters will decide on a ballot measure that, if approved, would introduce sweeping changes to property taxes.

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Amendment 3’s impact on properties with homestead exemptions — which are their owners’ primary residences — has occupied the spotlight. If passed, Amendment 3 would exempt the first $150,000 of a property’s assessed value starting next year, up from just over $50,000 today. That number would climb to $250,000 in 2028.

But another provision cuts in half the cap on how much the assessed value of non-homesteaded properties can rise each year. Starting next year, that limit would drop from 10% to 5%.

Amendment 3 needs to win 60% of the vote to pass.

Here’s a breakdown of the ballot issue:

What property could be affected by the tax cap?

Second homes, and investor, rental and commercial properties would see their assessed value ceiling lowered. That could spell tax savings for those property owners.

But not all non-homestead owners are banking on massive tax savings.

Their concern? That local governments, having lost so much revenue from the increased homestead exemption, would levy higher property tax rates across the board — including on those same rental, vacation, multifamily and commercial properties whose assessed value increases Amendment 3 had capped.

Local governments could also make up for the shortfall with higher fees and fines.

“It has to come from somewhere,” said Lynda Harris, a small-scale affordable housing developer who owns property in Brownsville and North Miami. “Will it be the utilities? Will they fine you to death?”

How does the cap work?

As it stands, Florida has a 10% annual cap on assessed-value increases for all properties without homestead exemptions. Amendment 3 would halve that cap to 5%. Together, those properties account for nearly $443 billion, or 73% of the total assessed property value in Miami-Dade.

That means that if a property’s market value grows faster than 5% a year, the owner would pay taxes on an assessed value that’s potentially far lower than what the property could fetch on the open market. The perk would compound over time if the property’s market value has many years of sustained value growth.

But if that owner decides to sell the property, that parcel’s assessed value resets to whatever its current market value is — basically erasing the benefit. The new owner would pay taxes based on the property appraiser’s assessment of the parcel’s value, and the clock would reset on their 5% cap.

So, for owners who hold onto their property, the potential savings are real.

But the cap wouldn’t make a difference for property owners whose assessed values aren’t increasing by more than 5% a year. Harris, the affordable housing developer, said that as the real estate market has cooled in recent years, her properties’ assessed values have been increasing by less than 5% each year.

Miami-Dade Property Appraiser Tomás Regalado told the Miami Herald that the assessment cap is expected to lead to a $50 million reduction in property taxes in the county, though he couldn’t estimate how much individual property owners could expect to save as a result.

He said the cap would affect between 300,000 and 400,000 properties in Miami-Dade.

Will taxes still rise?

Any savings assumes that local governments don’t raise property tax rates to make up for homestead revenue lost if Amendment 3 passes.

Across Florida, local governments stand to in 2028 if voters approve Amendment 3, according to state estimates. Without a funding source to plug that hole, residents could see cuts to public hospitals, libraries, parks, emergency services and public transit, local leaders have warned.

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That leaves local governments with a set of choices: cut services, raise fees or increase property tax rates, said Nicole Fox, a tax policy analyst with the Tax Foundation, a nonpartisan, Washington-based research group. Many could do some combination of all three, she said.

Henry Torres, the president of Coral Gables-based Astor Companies, said he expects the county to raise the tax rate and charge higher fees if Amendment 3 passes.

Torres also said he expects the cost of permits and developer impact fees to rise if Amendment 3 becomes law.

“Probably the commercial side will get hurt,” said Torres, whose company primarily develops multifamily apartments. Still, he said he supports the ballot initiative because he thinks it would help struggling homeowners in Florida.

And, at least to a point, Miami-Dade governments would be within their constitutional rights to raise taxes on properties without homestead exemptions. In some cases, they could do so substantially.

The Florida Constitution limits county and municipal tax rates for operating budgets to $10 for every $1,000 of taxable property value. To go beyond requires a referendum.

— currently at $7.25 per $1,000 of taxable value — has some wiggle room, county data show. So does Broward’s $5.66 tax rate. That leaves the counties space to raise property taxes to compensate for lost revenue, said Fox, the tax policy analyst.

Major South Florida cities have similar room to increase rates. Miami’s tax rate is $7.10, Miami Beach’s $5.80 and Hialeah’s $6.30. Other cities, including Sunny Isles Beach and Doral, charge around $1.60 per $1,000 of taxable value.

Regalado, the Miami-Dade property appraiser, has been a vocal proponent of Amendment 3. He said he doesn’t expect to see a dramatic increase in municipal tax rates because of the backlash it could cause with voters.

“Raising the millage to the maximum, which is 10, is kind of a political suicide,” Regalado said.

But Alexander Ruiz, the chief operating officer of South Florida developer and property manager Prestige Companies, isn’t so sure that local governments would forgo property tax increases.

Local governments “are going to look to make up the revenue in some capacity,” he said. “It may result in a net [property tax] increase. That’s what we’re concerned about.”

This story was produced with financial support from supporters including The Green Family Foundation Trust and Ken O’Keefe, in partnership with Journalism Funding Partners. The Miami Herald maintains full editorial control of this work.

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This story was originally published October 28, 2026 at 5:05 AM.