Friday, August 24, 2007

Not so good news for homeowners.

With this week's mailing of tax notices by Property Appraisers in Florida, it becomes more and more evident that the Save-Our-Homes provisions will gradually be phased out and are already under attack.

This regulation protects the homestead-homeowner by preventing an annual increase in the assessed value of his property tax of more than 3 percent. It protected many homeowners from being suddenly hit by the doubling or tripling of home values during the “boom” years.

But, as many taxpayers found out this week, by a rather strange twist, the situation has changed. Even though the market value of your home has gone down, your tax bill could still increase up to a 3 percent every year. In effect the taxable value will be increased by this 3% until it reaches the actual market value. Does it make sense?

It does if you belong to our counties and cities government. Not so if you are trying to keep your home, maintain your life level, and raise a family.

Even though it is evident that real estate values have been sensibly reduced during the last year, assessments have gone up overall, perhaps because they are based on 2006 values.

The tax reduction was aimed at the “Tax Rate”, not at the” Assessment Value”, as property owners are starting to understand.

Basically the “Save-Our-Homes” protected-homeowner will get some relief now, since his assessed value will go up no more than 3%, while the tax rate could been rolled back as much as 9%, as mandated for this year by the legislators.

Any other property-owner will hardly get any break.

No relief for snowbirds vacation-home owners; no relief for investors, no relief for new home buyers.

Empty-nesters thinking of moving to downsize? Anybody remembers that story? It should have been one of the important parts of the “tax-relief” laws, but evidently our legislator forgot.

And, despite the “roll-back” provisions, taxes do not necessarily go down.

Remember the opt-out clauses for the cities? They are part of the legislature provisions. Cities can invoke the “tax-relief” op-out exception and just ignore the rollbacks. And a few cities have already taken advantage of the opt-out to ignore the tax relief laws.

At the same time, property taxes that pay for public schools haven’t been reduced. According to the new law, they can be and have been increased. And they count for almost thirty percent of your tax bill.

All in all, the “tax-break” is much less than most homeowners expected. The tax cuts are insignificant or just non- existent.

This is not what will revive Florida real estate.



You can visit my website:
www.condo-southflorida.com

for more information and news about Florida Real Estate.
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