Most people have forgotten about this but for all you snow birds looking to buy a place in Florida there is a 10% cap on non homestead property assessed values.  I found the information below on the property appraisers web site….

10% ASSESSMENT LIMITATION FOR NON?HOMESTEAD PROPERTY

Q: When did the 10% cap go into effect?
A: It became effective beginning with the 2009 tax roll. The 10% cap will only
ensure your assessed value does not increase more than 10% from the previous
year assessed value. The cap will remain, providing ownership does not change,
there was no split or combination of the property during the previous year, and
no new construction has occurred.
Q: Do I have to apply to receive this cap?
A: No, the cap will automatically be applied to your property.
Q: Can I get the 10% cap on my homestead property?
A: No, this assessment cap is only for all “non-homestead” properties. Homesteads
already benefit from the maximum 3% Save Our Homes assessment cap.
Q: What is “non-homestead property”?
A: All properties that DO NOT have a homestead exemption, such as 2nd homes,
rental properties, vacation homes, vacant land or commercial property.
Q: Will the 10% cap reduce my taxes?
A: There is no guarantee your taxes will reduce due to the 10% assessment cap, as
many other factors are involved such as tax rates and non-ad valorem
assessments, neither of which are determined by the Property Appraiser.
Q: Will my assessment increase 10% each year?
A: Not necessarily. The maximum amount your assessment can increase from one
year to the next is 10%. Depending on market factors, your assessed value
could increase less than 10% or could decrease.
Q: Does the 10% cap apply to millage rates of ALL taxing authorities?
A: The 10% cap applies to all taxing authority millage rates EXCEPT the School
Board millage.
Q: If I purchase a property that has received benefit from the 10% cap,
will my assessment change from the prior owner’s assessment?
A: The 10% assessment cap remains for the balance of the tax year in which the
property was purchased. But, Florida law provides that the property must be reassessed
at full market value in the year following the sale.
Q: If there is a change of ownership or control not recorded on a deed,
does it trigger a reassessment?
A: Yes. And per Florida Statute 193.1556, any person or entity owning property
under the 10% cap provision MUST notify the property appraiser promptly of
any change of ownership or control. Failure to do so may subject the property
owner to a lien of back taxes plus interest of 15% per annum and a penalty of
50% of the taxes avoided.

How should I send a notice for breach of a sale (or lease) Contract?

The first thing to remember is that the real estate agents are NOT parties to the Contract between the parties.  Nor are we lawyers and thus we can not create a notice from one party to another.  The notice must come from one party (say the Seller) to the other party (say the Buyer).  That notice must be delivered in accordance with the terms of the Contract between the two parties.  This is why the addresses on the sales Contract are SOOOO IMPORTANT.  These are where the notice should be addressed to the other party.

Now, most of us use the FAR BAR As-Is contract which states:

“Notice and delivery given by or to the attorney or broker (including such broker’s real estate licensee) representing any party shall be as effective as if given by or to that party. All notices must be in writing and may be made by mail, personal delivery or electronic (including “pdf”) media. A facsimile or electronic (including “pdf”) copy of this Contract and any signatures hereon shall be considered for all purposes as an original.”

Thus, what I recommend is that any Notice, say from the Seller to the Buyer for instance, should:

• Be drafted by the Seller.
• Be from, and signed by, all Sellers listed on the Contract (John Seller and Mary Seller).
• Be addressed to the Buyer(s) listed on the Contract (Joe Buyer and Christine Buyer).
• Be addressed to the Buyer(s) address listed on the Contract.
• May be sent to the other party via mail which should be done via certified mail AND regular mail which assumes that if it properly addressed is received by the other party 5 days after mailing.
• May be sent to the other party via personal delivery. If this is used then get the other party to sign for receipt of the Notice.
• May be sent to the other party via facsimile or e-mail.  If the e-mail method is used then attach the Notice as a pdf and request a read receipt when sending it.
• May be sent via any of these methods to their attorney, broker, or sales agent of that broker.  As with the methods above you will need the receiving party to acknowledge receipt of the notice.

Be aware that if the Broker (and thus their sales agent) has a No Brokerage relationship (as opposed to Transactional or Single Agency) with their party to the transaction then they are NOT representing them and thus they CAN NOT receive notices for them. This is often the case in a limited services listing and some times the case in a bank owned or REO listing.  Ask your sales agent to verify the Brokerage relationship (Transactional, Single or No Brokerage) of the other sales agent.

I get this one literally EVERY time I go out with a customer moving to the area…

“How much are the taxes?  …  Oh, that can’t be right”

Florida has no state income tax unlike most states such as New York (8.82%), New Jersey (8.97%) and my home state Massachusetts (5.15%).  Thus a large portion of the operating revenue is collected from property taxes.  This is a bit of the left pocket or right pocket conversation but the fact is, the tax man cometh.

Florida real estate taxes are collected in arears.  Thus values, and those eligible for homestead exemption, are established on January 1 of each year.  You have until March 1st to file for the Homestead exemption but remember you must reside at the property in question on or before January 1st.  You will receive a proposed valuation of the property in early August and have 30 days from then to contest this proposed valuation.  I have contested these valuations before with a some success but typically it’s not worth the time.  The tax man rigs the system by consistently under valuing properties.

The tax bills are sent November 1st and receive a diminishing discount if they’re paid early of 4% if paid in November, 3% in December, 2% in January and 1% in February but are not actually due until March 1st and delinquent (incur a penalty) April 1st.

The millage rate (% of taxable value paid in taxes) varies depending upon if you’re in a municipality or unincorporated area of the county as well as varies from town to town.  Remembering that valuations are done on a mass appraisal process and thus your property is NOT individually assesed (at say the last sales price) unless your in a ultra high end community like Seminole or Lost Tree.  Here’s my math I tell people who will not be full time residents buying in Florida…

(Purchase Price) X (0.85) X (0.02)

Now, this is very simplified math and does not take into account that there are both ad valorem (according to value) and non ad valorem portions of the tax bill but if we use this then we can avoid the sticker shock.  If you’r buying a million dollar property then…

1M * 0.85 * 0.02 = 17k a year in real estate taxes

What can I say, Palm Beach is not a cheap place to live.  But again if you establish a residency here then you get the valuation of your property capped and no state income tax.