Understanding Florida Property Taxes — A Guide for South Florida Home Buyers

by David Cohn

When purchasing a luxury property in South Florida, understanding the state’s property tax system is critical for making informed financial decisions. Florida’s tax structure is famously homeowner-friendly, but there are still key details every buyer should know, especially in markets like Jupiter, Palm Beach, and Stuart, where values and exemptions significantly influence long-term costs.

Florida’s Property Tax Overview

Florida property taxes are ad valorem, which means they are based on the property’s assessed value. The average effective property tax rate across the state is 0.83%, making it one of the lowest in the United States. However, in counties such as Palm Beach, rates typically range between 1.0% and 1.3% depending on city services and school funding needs.

Homestead Exemption — Florida’s Best Homeowner Benefit

The Homestead Exemption allows homeowners who make their Florida residence their primary home to deduct up to $50,000 from the assessed value of their property for tax purposes. The exemption also caps annual assessment increases at 3% or the rate of inflation (whichever is lower), helping homeowners maintain predictable and affordable taxes over time.

Eligibility Requirements:

You must occupy the home as your primary residence by January 1 of the tax year.
You must file for the exemption by March 1 of that same year.

For luxury homebuyers, applying for the Homestead Exemption can translate to thousands of dollars in annual savings, particularly for waterfront or golf-course properties in high-value zones like Palm Beach Gardens and Jupiter Island.

Additional Tax Advantages for Florida Homeowners

No State Income Tax: Florida is one of the few states without individual income tax, allowing homeowners to retain more wealth.
Portability: Homeowners who move within Florida can transfer their accumulated tax savings (under the Save Our Homes benefits) to a new homesteaded property.
Senior Citizen and Veteran Breaks: Extra exemptions are available for eligible seniors and military veterans, offering additional reductions on property assessments.

County-by-County Variations in South Florida

While property tax rates can differ across Palm Beach, Martin, and Broward counties, all offer reasonable rates compared to similarly priced markets nationwide:

Palm Beach County: Average effective rate around 1.06%; median tax bill approximately $4,800 for luxury homes.
Martin County (Stuart / Palm City): Slightly lower rates (0.9–1.1%) with highly rated school district allocations.
Broward County: Typically higher due to urban services but offset by strong infrastructure growth.

How to Lower Your Property Taxes

Verify Your Assessment: Check for errors in assessed value that may increase your tax bill.
File for All Qualifying Exemptions: Including Homestead, widow(er), or disability exemptions.
Appeal When Necessary: Homeowners may file an appeal with the county property appraiser’s office if their property is over-assessed.

Expert Tip — The Investment Advantage

Savvy investors also benefit from Florida’s favorable tax climate. Even for non-homestead properties, limits on annual value increases (10% cap) make the state ideal for second-home buyers seeking long-term stability in property expenses.