TAMPA, Fla. — Thousands of new homeowners in Tampa Bay are about to get sticker shock. Trim (Truth in millage) notices will be sent out within the next several weeks (mid-August) and some people will see massive tax increases.
You can blame it on the booming real estate market.
When a buyer purchases a home, after their first January in the home, the seller’s “Save-Our-Home” cap comes off from the home’s property taxes. The impact is typically greater if the seller was a long-term owner with a homestead exemption, because it produces a large gap between the just/market value of the home and the assessed values.
The “Save Our Homes” rule limits annual tax increases to a maximum of 3% a year. However, when a home is sold, the tax is re-adjusted to the market value of the home.
With property values skyrocketing, those new homeowners who didn’t already have a homestead exemption to transfer, could end up with a significantly higher tax bill.
“Property values from the sales of 2020 and 2021 went up an average of 20% countywide,” explained Pinellas County Property Appraiser Mike Twitty.
Twitty said when you buy a home, your estimated taxes are based on what the last homeowner paid and reflect the home’s value before a sale.
“If you’re a new homebuyer, what you don’t want to do is look at what the seller was paying in taxes because if you do, you’re going to be very misled,” he added. “It’s a bigger issue than it’s ever been."
Twitty suggested before buying a house, using a property tax calculator. Most local counties have one on the Property Appraiser’s website.
Also, if it’s your primary home, file for a homestead exemption as soon as possible — to ensure your taxes are capped in the future.
Pasco County homeowner Eugene Bednarski found himself with a surprisingly large tax bill recently. Bednarski filed for divorce in 2020. Previously, when Bednarski and his then-wife bought their Hudson home 13 years ago, they only put his wife’s name on the title. Now that she no longer lives there, the Pasco County Property Appraiser's Office said he doesn’t qualify for a homestead exemption.
“They are saying because I’m going to be titling the house and I wasn’t on the title, it’s like I’m buying the house for the first time. I’ve lived in the house 13, 14 years,” he said with frustration.
In 2009, Bednarski’s house was assessed at $160,000. The current value is nearly $430,000. That’s what his current tax bill is now based on, and it means his bill jumped from $1,531.33 in 2021 to owing $5,005.63 (including $3,474.30 that Pasco County claims is past due).
“Because of the way the housing market has exponentially grown, and market values are high, it really puts a magnifying glass on the problem,” Bednarski added.
ABC Action News contacted the Pasco County Property Appraiser to ask about Bednarski’s case and we were told their legal team is looking to see if his case might qualify for an exemption.
As of now, he has until July 5 to pay the new taxes before Pasco County places a lien on his home. Bednarski said he is willing to pay, if it comes to it, despite feeling that the increase is unjust.
“I’m not going to lose my house over a few thousand dollars,” he added.
Twitty expects the increase in property taxes to continue as the housing market remains tight.
Currently, there is less than one month of supply of homes. Twitty said a balanced market is closer to six months of supply.
Twitty said to pay attention to your TRIM notice, which should be in your mailbox by the third week of August.
“Make sure you read it, don’t throw it away, especially this year of all years you want to look at it,” he elaborated.