Disclosures Protect Buyers
The Save Our Homes Amendment to the Florida Constitution limits the increase in property tax assessments to three percent annually, or the percentage of increase in the Consumer Price Index, whichever is less. But that artificial cap disappears when the house is sold, and often results in very hefty property tax increases.
Prospective buyers often research tax records or check with their sales associates to see last year’s property tax bills, but some are not aware that the taxes will change when they buy. Last year, many Florida homes appreciated in value by more than 30 percent. Some have more than doubled in value since the current owners occupied the property.
The Florida Legislature recently acted to protect consumers. Since January 1, 2005, real estate licensees have been required to give buyers the following disclosure before the buyer signs the purchase agreement:
Property Tax Disclosure Summary
A buyer should not rely on the seller’s current property taxes as the amount of property taxes that the buyer may be obligated to pay in the year subsequent to purchase. A change of ownership or property improvements triggers reassessments of the property that could result in higher property taxes. If you have any questions concerning valuation, contact the county property appraiser’s office for information.
To stay within the law and avoid financial liability, be certain your purchase agreement has this important disclosure, or give it as a separate form to your buyer.
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