The Commercial & Investment Property Tax Cap in Florida's 2026 Amendment

The headlines about Florida's 2026 property tax amendment are all about homesteads — the exemption jumping to $250,000. But buried in the same measure is a provision that matters if you own commercial, industrial, rental, or second-home property in Florida. It's worth understanding, because no one's writing about it.

The provision: 10% becomes 5%

Since 2008, Florida has capped how fast the assessed (taxable) value of non-homestead property can rise — at 10% per year — no matter how hot the market gets. "Non-homestead" covers everything that isn't your primary residence: commercial buildings, industrial space, apartment complexes, rental homes, vacation and second homes, and agricultural land.

HJR 1 would tighten that cap to 5% per year, starting January 1, 2027 (if voters approve it with 60% in November).

That sounds modest. Over a single year it is. Over a holding period, it compounds into real money.

What it's worth — a worked example

Say you own a commercial property assessed at $2,000,000, and the market is appreciating about 12% a year (not unusual in recent Central Florida cycles).

Year	Assessed at 10% cap	Assessed at 5% cap
1	$2,000,000	$2,000,000
2	$2,200,000	$2,100,000
3	$2,420,000	$2,205,000
4	$2,662,000	$2,315,000
5	$2,928,000	$2,431,000

By year five, the 5% cap keeps roughly $497,000 off your taxable value versus the 10% cap. At Central Florida commercial millage (~16–18 mills), that's about $8,000–$9,000 less in property tax that year alone — and the gap keeps widening every year you hold.

For an investor underwriting a long hold, slower assessment growth means more predictable carrying costs and a stronger, more defensible pro forma. That belongs in your model.

Two things commercial owners should keep straight

1. The exemption increases don't help you. The $150,000 / $250,000 homestead exemption increases apply only to primary residences. Commercial and investment property get none of that — the assessment cap is the part of this amendment that helps non-homestead owners.

2. The cap excludes school taxes. Like the existing 10% cap, the 5% limit applies to county, city, and most special-district levies — not school district taxes. Your school-tax assessed value will still track the market. It's a meaningful break, just not a total one.

And as always: the cap resets to market value when the property sells or changes use. A new buyer starts fresh at market, then the cap limits growth from there — the same mechanic as the residential Save Our Homes reset that drives buyer "sticker shock."

The bigger picture for Florida commercial

Pair this with the other major change on the books — Florida eliminating the commercial rent sales tax on October 1, 2025 — and the trend is clear: the cost of both occupying and owning commercial space in Florida is coming down. For investors weighing where to deploy capital, that's a tailwind layered on top of no state income tax and steady in-migration.

The bottom line

• HJR 1 would cut the non-homestead assessment cap from 10% to 5% starting 2027.
• It applies to commercial, industrial, rental, and second-home property — but not to school taxes, and not the homestead exemption increases.
• Over a multi-year hold in an appreciating market, it meaningfully lowers and stabilizes your tax bill.
• It still needs 60% voter approval in November 2026.

Evaluating a commercial or investment property in Central Florida? We'll help you model taxes, carrying costs, and the new caps before you commit. Browse listings on the map or reach out.

Reflects HJR 1 as passed June 2, 2026, pending the November 3, 2026 vote. General information, not tax or investment advice.