Florida voters on Tuesday approved a major overhaul of the state’s property tax system. But the droves of billionaires and other ultrawealthy people who recently moved there are unlikely to notice much of a difference from its headline tax break.
Amendment 3—which raises the homestead exemption on non-school property taxes from $50,000 to $150,000 in 2027 and to $250,000 in 2028—passed with 62% of the vote, according to the Associated Press. Supporters pitched Amendment 3 as relief for everyday homeowners, and for many, it is. But because the exemption is a flat dollar amount, it does far less for the billionaires who turned South Florida into one of the country’s wealthiest enclaves.
Take Citadel CEO Ken Griffin, who moved his firm from Chicago to Miami, and Amazon founder Jeff Bezos also moved to Miami in 2023 and has since bought a $237 million compound on Indian Creek, the island nicknamed “Billionaire Bunker.” Bezos is also reportedly buying a $69.5 million oceanfront estate in nearby Golden Beach.
Experts told Fortune, though, the bigger factor of Amendment 3 for people like Griffin and Bezos is a less-noticed part: a tighter limit on how fast taxes can rise on second homes, rentals, and other properties that aren’t a primary residence. Florida caps how much those properties’ taxable values can increase each year, and Amendment 3 cuts that cap from 10% to 5%. In a hot market like South Florida’s, that slows tax growth on homes whose values are climbing quickly, and many wealthy buyers own more than one.
But for a billionaire who claims a Florida homestead, the savings from Amendment 3 aren’t that noticeable. Raul Gastesi, a real estate attorney and cofounder of Miami law firm Gastesi Lopez Mestre & Cobiella, calculated that at the statewide average non-school tax rate, the expanded exemption will save a homestead owner about $2,085 a year once fully in place. A home assessed at $350,000 would see its local services property tax bill fall from about $3,135 to about $1,050. A $50 million homestead would go from about $524,000 to about $522,000.
“For the typical family it is real money,” Gastesi said. “For the mansion owner, it is a rounding error.”
That’s because the relief is concentrated in the middle of the market. By 2028, a homeowner with a $400,000 house will see much of the portion of their property tax bill that funds cities, counties and local services disappear, Michael Ligon, a strategic capital investor with The Ligon Group in Miami, told Fortune.
“Proportionally, this is middle-class relief wearing a luxury headline,” Ligon said.
Therefore, Michael Martirena, a South Florida luxury real estate advisor, said the change isn’t driving his clients’ decisions.
“Someone buying a $20 million or $50 million home in Miami is coming for no state income tax, the lifestyle, and the business climate,” he said. “A few thousand dollars a year, and a five-year wait for the full exemption does not change that math. Where it does register is with clients who hold several properties.”
That wait applies to anyone who isn’t a permanent Florida resident by Dec. 31, who will start at the current $50,000 exemption and won’t get the full amount until their fifth year. Gastesi estimated that costs about $8,400 in forgone savings, which likely wouldn’t be enough to sway the next billionaire thinking about a move.
“Amendment 3 may influence timing, but likely not destination,” Abigail Hall, an economics professor at the University of Tampa, told Fortune.
The real money is in second homes—and so is the risk
For wealthy owners with more than one Florida property, the lower cap matters more. In a market where values rise 8% a year, Gastesi estimated, it would save the owner of a $50 million second home about $15,750 in the first year and roughly $280,000 over five years.
But local governments still have to cover the cut. State economists estimate cities, counties, and special districts will eventually lose $11.86 billion a year, and the amendment doesn’t provide new state money to replace it. Miami-Dade County alone estimated it could lose roughly $385 million in the first year.
“There is not a reasonable way for local and municipal governments to fully close these gaps,” Hall said.
If they raise rates, an increase of just $1 for every $1,000 of taxable value would cost the owner of a $50 million homestead about $49,750 a year, Gastesi calculated, wiping out the exemption’s savings many times over.
“Homeowners should read their tax bills closely next year, because the savings on one line may come back on another,” Gastesi said.