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Property Tax Info
What You Need To Know About Property Taxes
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Before assessing any parcel of property, the appraiser estimates its market value. Market value is how much a property would sell for, in an open market, under normal conditions. To estimate market values, the appraiser must be familiar with all aspects of the local real estate market. Information such as sales prices, construction and repair costs,
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normal operating expenses, typical rents, and current financing charges are all considered.
We consider three approaches to value when preparing the roll. First, similar properties' sales prices are compared, using only sales where the buyer and seller both acted without undue pressure. This method is called the market approach and is normally given greatest consideration when valuing residential properties.
The second method is to calculate what it would cost, using today's labor and material prices, to replace the structure with a similar one. If the structure is not new, the appraiser determines how much it has The third method is to analyze market and property-specific occupancy rates, vacancy allowances, and operating expenses to determine what an income-producing property presently earns or expects to earn in the near future. This net operating income is factored to determine value. This method is called the income approach. |
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With today's technology, appraisers can estimate values using these three approaches more efficiently than with paper, pencil, and calculator. Computer Assisted Mass Appraisal (CAMA) techniques are used to analyze sales and estimate values for many properties at once.
Once the appraiser estimates the market value of a property, its assessment is calculated. Florida law provides that all property be assessed at 100 percent of market value less the cost of the sale.
The Florida Constitution was amended effective January 1, 1995, to limit annual increases in assessed value of property with Homestead Exemption to three percent or the amount of the Consumer Price Index, whichever is lower. No assessment, though, shall exceed current fair market value. This limitation applies only to property value, not property taxes.
When a house is sold, the new owner will be assessed at the current fair market value. The property will fall under the limitations the year after the new owner receives their new Homestead Exemption.
If additions or improvements are made to the property, the value of those improvements will be added to the roll regardless of the cap. For example, if a pool is added to a property, the value can increase no more than 3% plus the value of the pool. If we correct such items as size, number of bathroom fixtures, installation of heat and/or air conditioning, the value of those corrections will also be added to the roll above the 3% cap.
The cap does not apply to portions of multiuse or multifamily properties that are not homesteaded or rented to tenants. For example, if you own a duplex, live in one half and rent the other half to a tenant, only 1/2 of your property value will be capped. The cap remains in effect upon the change of title due to divorce or death of a spouse as long as the remaining owner continues to live on the property as their permanent address. If the owner adds children to the deed but remains on the property, the cap is also protected.
In multiple owner situations where not everyone receives a Homestead Exemption, only the percentage of ownership the homesteaded owner possesses will be covered under the Save Our Homes cap. For two owners with one homesteaded and the other not, only half of the value of the property will be protected. If another non-homesteaded owner is added, the capped percentage drops to one third.
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