# High Cost of Florida Living



## JLB (Jan 15, 2008)

We have had several discussions about the high cost of Florida living . . . unrealistic real estate prices, high insurance, and high property tax.

I believe it was last year when we were here that the governor was campaigning, promising to do something about.

Well, we haven't been here to know the intervening facts, but this year there is an upcoming proposal on the ballot to double the Homestead exemption and other stuff I haven't studied.  It is getting as much attention, or more, than the presidential primaries.

At the same time, the run-away real estate market has softened, a combination of the home loan debacle, high taxes, high insurance, and other inconveniences associated with Florida living.

There were articles in the Ft. Myers area about a major developer near collapse, and prices in areas we are familiar with are depressed, with sales slow.  There were more beachy properties with _for sale _signs than without them.

For those who have purchased in the last few years, they could face a bad result if they have to sell now.


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## Hophop4 (Jan 15, 2008)

Yes, we own a couple acers of land down there in Florida that we inhereded and have watched the taxes go up every year on it.  It is unreal!!


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## Don (Jan 15, 2008)

On 1/29, we vote as to whether we double the Homestead exemption or not.  It also other provisions for businesses and non-homesteaded properties.

Even though real estate prices have dropped dramatically, county appraisals did not drop hardly at all; keeping the tax values high.  That way, the county can keep their pockets full while pleading poverty.

In my own situation, lots like the one I have rose to a high of $240K and my appraised property value (house and lot) rose accordingly. Thank God I'm homesteaded and the taxable value had a 3% maximum limit.  Now those same lots are selling for $90 to $110K and my appraised value only dropped $6K, but my taxable value rose (about 2%) because of a provision of the homestead law which pretty much says that the taxable value must rise and cannot drop regardless of the home's worth.


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## Steamboat Bill (Jan 15, 2008)

I have been in Florida all my life and MANY people are complaining and getting hurt.

My (non-political) solution is - vote "No" on the  upcoming election for that weird new law.

Then cut real estate tax in 1/2 as we are currently paying 2.13% and then increase the state sales tax 1c.


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## PA- (Jan 15, 2008)

If tax income drops due to higher homestead exemptions, the money would need to be made up on with higher taxes on non-homesteaded properties, like timeshares.  The county isn't going to let their income go down, their budgets don't go down just because property values fall.  So they'll have to make up the difference.


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## Carol C (Jan 15, 2008)

This should probably be in TUG Lounge. But I'll butt in to say besides Florida, Georgia is about to make a big change in property tax. It's likely we'll have a referendum placed on next Nov ballot that would eliminate all ad valorem taxes in favor of across the board sales tax on both goods *and* services. I think that is pure folly for many reasons. Anyway, to see what's up in GA if you're interested in tax changes, click here: http://www.legis.ga.gov/legis/2007_08/house/greatPlan/faq.html


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## beanie (Jan 15, 2008)

We moved from NJ so we were used to double the taxes we pay here . but on the other hand teachers , fireman , and policeman were paid alot more up there . we also sold high and bought high so that was a wash . well actually it wasn't a wash because the profit on the NJ house enabled us to purchase a town house and a lot out right . with 7 yrs to retirement I feel we did the right thing by moving to florida . yes there are some things more expensive such as home owners ins ( slightly higher ) ,food  , and gas but the savings in property taxes offset those and what a place to live . we are in within close proximity (15-20 mins ) to 3 great beach areas and alot of things within a few hrs drive . would I do it again ? in a heartbeat !!! now my wife she is just now getting used to it after being here for a yr and a half but I think that has more to do with missing the kids . like they used to say in the old commercials " come on down "  !!


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## JLB (Jan 15, 2008)

Being somewhat aware of the rules here, I certainly did not perceive this as a political issue.  I was just reporting on the status of things down here.

I am fairly confident that our involvement in Florida real estate will continue to be one week at a time.


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## The Conch Man (Jan 15, 2008)

Steam has it right but I don't agree with his statement cause "Rich" people get the same which isn't right ~ working people are in foreclosure cause they can't keep-up with Taxes, Home Insurance (including Hurricane, Hazard & Wind) & Auto coverage while both work & maybe, work two jobs to try to keep-up.

Its been wacko for years & its become reality! Taxes are really out of site & this January election on doubling the Homestead Act is a joke! The Governor of this State is trying to avoid the problem, which is what he ran for during the election process.

Insurance is the other problem which politicians don't remark to but what's new for any State or Federal for that matter other than Florida is very high in both categories. :annoyed:


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## Steamboat Bill (Jan 15, 2008)

The Conch Man said:


> Steam has it right but I don't agree with his statement cause "Rich" people get the same which isn't right ~ working people are in foreclosure cause they can't keep-up with Taxes, Home Insurance (including Hurricane, Hazard & Wind) & Auto coverage while both work & maybe, work two jobs to try to keep-up.



I am really confused by your statement. 

What is the difference between rich and non-rich people when it come to paying real estate taxes? We all pay about 2.1% (give or take a few points). Additionally, most rich people have kids in private schools (should they get a rebate on that portion of their taxes?). Also, many so called rich people can easily become poor and loose their homes as they can have very high mortgages, taxes, insurances, etc. In fact, they pay MORE for jumbo loans (over $417k) than non-jumbo loans.

Thus, my "opinion" is that our state tax is too low (Florida has a general state sales & use tax rate of 6%.).....I recently visited Stowe Vermont and paid 10% on EVERY purchase!


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## Dori (Jan 15, 2008)

Don mentioned that he is homesteaded.  I don't mean to sound foolish, but what does this mean?  I don't know if we have anything like this in Canada.

Thanks.  

Dori


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## beanie (Jan 15, 2008)

Homesteaded means you get a $25,000 exemption off the value of your house and the rise in value is capped at 3% a yr .


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## Steamboat Bill (Jan 15, 2008)

beanie said:


> Homesteaded means you get a $25,000 exemption off the value of your house and the rise in value is capped at 3% a yr .



For most people the $25k exemption is no big deal (saves you about $525 per year though). The most important thing is that it "LOCKS" your taxable value into what you bought it for and can only increase by 3% per year. Thus, if you bought a home for $500k in 2001 and it is now worth $1m (you only pay taxes on the original amount + 3%).  

This creates a problem for many people as they can no longer afford to buy their own homes and are landlocked as there is no portability. In other words, if you are in a home that is worth $600k (but you paid $300k years ago) and want to sell and move to another part of Florida and buy a $600k home, your taxes would double from $6k per year to $12k per year. Thus, people feel they are stuck.


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## JoAnn (Jan 15, 2008)

We have a German neighbor who can only stay here one day less than 6 months of the year, either total, or coming and going...she stays all winter.  So, she has NO homestead exemption.  Last year she asked me if our taxes went up much, and I said, 'no, they were about the same in '06'.  She said her taxes went from $6,000 to $9,000.  The 'non-resident' homeowner here got hit very hard with taxes, because they also are not eligible for the 'Save Our Homes'  or Homestead law.  She said if the taxes kept going up like that she would have to sell.  And she has a gorgeous house...the nicest around.  

Many of the people from 'overseas' were moving out, but I understand some are coming back because they can buy more over here now, than before.


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## BocaBum99 (Jan 15, 2008)

Florida should scrap the idea of doubling the homestead allowance.  Instead, they should allow owners to transfer their homesteaded amount to a new home.  

The current situation is that people who want to move cant' because they can't sell their houses.  And, if they did, their property taxes would go up too much for them to afford it.


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## talkamotta (Jan 15, 2008)

This is why timesharing will continue to grow. There are enough people that 
1. dont want to deal with two homes and the extra expenses.  2. cant afford to take the risk with the residential market.  3. people especially retirees will want to stress free thier lives as much as they can. 

5 of my 6 grandchildren and 2 of my 5 children live in Florida.  I love Utah but I dont like the cold; after Christmas I am done with the snow.  I always planned to sell one of my rental properties and move down to Florida for half the year.  Mainly because my kids are either in Florida or Utah.  I dont know if I would be able to do that even with the depressed market.  I dont know if I would  want to pay anther $3-6K in taxes. 

I live in the Salt Lake Valley actually  just a few miles from the base of Little Cottonwood Canyon.  Because of back injuries I dont ski so although I live in one of the greatest skiing areas in the country.  I live on 1/4 acre and my house is 1500 sq feet on the main and Utah has basements so total of 3000 sq ft. 6 bedrooms 3 full baths, etc. Even though the homes are 30 years old, the whole area is well maintained.  The house can easily appraise for over $300K but my property taxes are $1600/yr.  Every state has thier way to gather taxes.  Florida does it by high property taxes and toll roads. Utah has thier special excess sin taxes.  Add our property tax and state tax and you have Florida's property tax.


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## Steamboat Bill (Jan 15, 2008)

talkamotta said:


> This is why timesharing will continue to grow. There are enough people that 1. dont want to deal with two homes and the extra expenses.  2. cant afford to take the risk with the residential market.  3. people especially retirees will want to stress free thier lives as much as they can.
> .



I 100% agree with you!


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## Dori (Jan 16, 2008)

Thanks for the explanation.

Dori


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## chicklet (Jan 16, 2008)

My husband and I always thought we would buy a place in florida as snowbirds but now i am not so sure.  We really don't like to rent but with the taxes and insurance issues that may be the only way we could do it.  I've thought about other areas but when you're a snowbird you're looking for the warmest weather because you're only here for a short time.


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## JLB (Jan 16, 2008)

Hi Chicklet.  Are you here now?
- - - - - - 
Someone explain the following to me.

There are people who have lived in their houses for a long time, that paid realistic prices for them when they bought.  Now properties all around them have sold and the values are astronomically higher.  For example, as late as 1995 we were looking at places for $200-$300K.  Those same properties are now $3-5 Million.

Our first warning of this was about that time, 1995 or so, when we looked at a house in Bonita Beach, on the Bayside, a couple blocks from the Gulf beaches.  It was plain, but in good condition.  After we toured the rooms, the saleman said, "$1.5 Million, and, of course, the house is a teardown."

Another one on the bay that Rapmarks and we called on two different years was an even lesser frame house, probably worth low six figures 15 years ago.  The price was _now_ $3.5 million, for the lot, and it was now surrounded by spiffy new houses, like you see on CSI Miami.

Here's the questions:

*What happens to the property taxes of those who have not sold, but whose values have gone from $200,000 to in the millions, because of all the new houses around them?*

*And, what is the deal where some areas, like FMB, still have a lot of those original, lesser houses, while in nearby areas, say Bonita Beach, they have just about all been bought, bulldozed, and spiffy new ones put up.*

(A lot more of those spiffy new ones have for sale signs on them this year.)


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## Don (Jan 16, 2008)

Steamboat Bill said:


> This creates a problem for many people as they can no longer afford to buy their own homes and are landlocked as there is no portability. In other words, if you are in a home that is worth $600k (but you paid $300k years ago) and want to sell and move to another part of Florida and buy a $600k home, your taxes would double from $6k per year to $12k per year. Thus, people feel they are stuck.



The new version of the Homestead act that will be voted on contains a portability provision.


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## jlwquilter (Jan 16, 2008)

JLB said:


> Here's the questions:
> 
> *What happens to the property taxes of those who have not sold, but whose values have gone from $200,000 to in the millions, because of all the new houses around them?*
> 
> ...




The property taxes on the "old" homesteaded homes is way behind those of the newer built or recently sold homes. And it'll stay way behind until a sale does occur. At that point, the NEW owner will get a HUGE increase in taxes over what the old owner paid.

The owners of the "old" home will be ok if they died and do not have to buy another house...because otherwise they then too will be faced with much higher tax than they are used to. Ok, joking aside, it really is true that dying or moving out of state or renting and not buying another home in FL is the only way to avoid facing a big jump in taxes.

One good thing about real estate though is that the profit on the sale is not Federal taxed if you lived in the home 3 out of the past 5 years. That allowed us to take a nice "windfall" from selling our Boca home a few years ago, put a chunk down on the temp house we bought while our new house was being built (built using most of that $$ from the Boca sale). When (IF!) the temp house sells (we've been renting it out) within the allowable time frame, we'll put that "windfall" $$ down against this new house mortgage.

All I saying is that while I too am suffering from high property taxes, there is a little good news along the way.


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## chicklet (Jan 16, 2008)

Wishful thinking JLB...reread my post and it sounded like i was there!   We were there from Dec. 22-Jan 3 first at Daytona and then Ginn Resort in Reunion.  Hopefully getting down to my beloved Florida in April and then again next Christmas.  It's the in between winter months that are a killer.  We're rethinking our retirement plans but we do know that we will not be shovelling snow!  Hope you're enjoying your time....although I assume the Sandpiper will not be on the top of your list.  Enjoy the weather and have a drink or two for me.


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## Steamboat Bill (Jan 16, 2008)

My prediction will be - the new law will NOT pass. Then we will be in the same, or worse, condition as always.

My opinion is to cut real estate taxes in half for everyone and then make up the difference in an increase in the state sales tax or (don't shoot me) create a new state income tax. Most people don;t realize that Florida does NOT have any state income taxes and the use tax is a low 6%.


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## rapmarks (Jan 16, 2008)

Steamboat Bill said:


> My prediction will be - the new law will NOT pass. Then we will be in the same, or worse, condition as always.
> 
> My opinion is to cut real estate taxes in half for everyone and then make up the difference in an increase in the state sales tax or (don't shoot me) create a new state income tax. Most people don;t realize that Florida does NOT have any state income taxes and the use tax is a low 6%.




BOO!  no state income tax, that is why we moved here.


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## Steamboat Bill (Jan 16, 2008)

rapmarks said:


> BOO!  no state income tax, that is why we moved here.



This would be very difficult tax to start, but where will the money come from if they cut property taxes?


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## Sea Six (Jan 16, 2008)

I'd be more worried about where it GOES.  Once they take money from you at the State level, it won't be spent where you live.  It will surely go somewhere else, and I would be against that.


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## talkamotta (Jan 16, 2008)

jlwquilter said:


> One good thing about real estate though is that the profit on the sale is not Federal taxed if you lived in the home 3 out of the past 5 years. That allowed us to take a nice "windfall" from selling our Boca home a few years ago, put a chunk down on the temp house we bought while our new house was being built (built using most of that $$ from the Boca sale). When (IF!) the temp house sells (we've been renting it out) within the allowable time frame, we'll put that "windfall" $$ down against this new house mortgage.
> 
> All I saying is that while I too am suffering from high property taxes, there is a little good news along the way.



Renting a house that would be a primary residence has some tax guidelines that you need to be aware of. Im sure you are, but if you arent you should be.  What you said raised a red flag in my mind. 

I love the tax advantages my rental properties have afforded me while I was raising my children, etc.  Now that Im thinking when to sell them, there are options available but it can be a tangled irs web.  But this is getting into another topic.  

This topic is good, like many others, it keeps us informed of changes that we might be aware of.  My plans ten years ago, arent exactly the same as 5 years ago, or now, or 5 years from now.  The game just keeps changing.


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## Dottie (Jan 17, 2008)

I live in Florida and as yet am undecided on the Nov 29 Homestead changes.  They say they will need to make up revenue somewhere.  My question is why and what have they been doing with all of the extra income they have received from all on the new homes and condos sold at inflated values over the last 3 or 4 years?  It would seem that they had much higher than normal revenues and those years there were no comments on how it was spent.  I then lived in ST Johns County which was building new schools like crazy and yes, they were needed.  I now live in Marion county where the school population is not growing the same but apparently the money is gone.  Why?  It they don't do something to convince me they are issueing empty threats about needing the money for services, I will vote for the exemption.


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## Don (Jan 17, 2008)

That's a big reason we moved here.


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## rapmarks (Jan 17, 2008)

If I vote for the amendment to save $240 a year in taxes (which is what they say it will be in Lee County), and get an income tax instead, then the whole thing is a big scam.  They got rid of the intangibles tax, which the state revenue specialist said cost more to administer than it brought in.  Did it have disasterous results?   
My tax bill in Illinois was way higher than here, for a property worth much less.  There is something wrong with dramatically raising someone's property tax because someone else made a big profit, and then suddenly no one can sell their home, even for what they paid for it but the property tax bill is not lowered.


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## JLB (Jan 17, 2008)

Further reporting on local current events, although I did not see the story, the teaser for the evening news last night showed an official government meeting, like the setting of a city council, with the official person speaking saying something like, "They have made billions of dollars at our expense and they are going to find things are not going to be so easy from now on."

Then, the dub-over said something about what _whoever_ is saying about Allstate.


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## jfitz (Jan 17, 2008)

The news announcement was that Allstate has been banned from writing any new insurance policies in the State of Florida.  Florida's Insurance Commission has been holding hearings relating to Allstate's and five other insurance companies' business practices.  Allstate, in spite of several extensions, failed to produce information that was subpoenaed by the Commission so the Commission suspended their license.


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## jfitz (Jan 17, 2008)

A little background on Save Our Homes for all you snowbirds:

The Save Our Homes Amendment, initiated by Lee County's Ken Wilkinson, became effective on January 1, 1995.  The measure granted Florida residents a $25,000 exemption on the assessed value of their primary residence.  In addition, it capped the yearly increase in assessed value of that primary residence to a maximum of 3%.  Any savings in assessed value realized by the cap was not transportable if you moved. 

And what resulted:

Since real estate values have, until recently, risen far higher than 3% a year, through the "magic" of compounding, those who have bought recently as well as snowbirds and businesses, like your timeshare, pay a larger and larger share of the tax burden every year.  Additionally, residents failed to question where all the additional revenue generated during the housing boom went; their taxes weren't going up, why care, lets build all that new stuff and let the businesses, newbies and snowbirds foot the bill.  So instead of a decrease in millage and stable taxes, those not eligible for Save Our Homes saw their taxes rise dramatically to pay for the tax welfare afforded long term residents.  It is not uncommon for some homes in a community to be paying double or triple the taxes of identical homes next to them.   In a bad housing market, this inequity has certainly not been an incentive to buy.

And the proposed solution:

The "fix", to be voted January 29th, is to add an additional $25,000 exemption to homes assessed at more than $75,000, bringing the total exemption to $50,000.  Property not eligible for the 3% cap would get a 10% cap and tangible personal property would get a $25,000 exemption.  The Save Our Homes benefit, up to $500,000, would be transportable.

And my view on the result:

I believe the amendment will pass.  Supporters are advertising heavily; their message is "Vote Yes and see a $240 tax break, vote No and your taxes will stay the same".  A simplistic slogan that appeals to many voters.  Unfortunately, passage will only exacerbate the problem.  It doesn't solve the tax burden faced by those residents and non-residents just entering the Florida housing market nor does it address the current tax disparity, a burden which will continue to become more and more inequitable.  Transportability only works when you can find someone to buy your existing home and non-residents and businesses have plenty of other choices in places more friendly to them.  Hence, the measure will, at best, only have a temporary positive effect the housing market; the long term result will be to further depress growth in the housing market and tourism industry.

And my bottom line:

In spite of the tax situation, the home owner's insurance situation, and the occasional hurricane, I still would not want to live anywhere else.


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## KCI (Jan 17, 2008)

Been reading this thread and find it interesting.  We lived in Punta Gorda, FL for 11 yrs.  Bought a house for $170,000 on a canal in Burnt Store Isles.  After Charlie, Fran, Ivan, Jean, Wilma, Katrina, etc we decided we wanted out.  We came to SC, bought at Sun City Hilton Head (big mistake...builder is awful) but sold (luckily) our Punta Gorda home in Dec 2005 for $585,000.  Our taxes were just under $3,000 per year there, new buyer's taxes escalated to over $6,000 and here in SC our yearly taxes on a house we paid roughly just under $400,000 are $980.00.  Weather is not as warm as Punta Gorda in winter but (golfers still out almost every day) except for a few days here and there it isn't bad for winter (no snow) and summers are just as hot as FL.  Financially I figure we made a good move but I do miss FL.  Just a few thoughts to share.  Linda


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## Sea Six (Jan 17, 2008)

jfitz said:


> I still would not want to live anywhere else.



I'm with you on that statement.  I've been following this thread for some time and just don't agree with most of it.  When I worked in Philadelphia, I paid a 3.3% wage tax, a 3.2% state income tax, and a 6% sales tax.  Down here there is no city wage tax, no state income tax, the sales tax is the same, and my property taxes (considering the relative value of my homes) is still lower in Fla than it was in PA.  My home in PA was homesteaded just as my home in Fla is now, but the taxes are still lower and my home is worth more.  I have yet to meet anyone who moved here from the bigger Northeastern cities of Virginia, PA, New York, or especially New Jersey, who think their taxes or insurance are worse here in Florida.  My neighbor says his car insurance alone more than makes up for any difference, let alone the ridiculous rates people pay for real estate taxes in New Jersey.  My electric bill during the winter used to be over $300 in PA, now in the heat of summer with the A/C and pool running I may see a bill for $180.  I just don't see these cost items being discussed as unique to Florida, except for the flood insurance if you happen to live in a flood plane like I do, but that is to be expected - the risk is certainly higher.  Overall, our cost of living is considerably lower than it was up north.


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## JLB (Jan 17, 2008)

jfitz:

Thanks for the explanation.  I knew there had to be something that was allowing the longtime residence to stay during the property tax explosion.

It's interesting to me that that came about at just about the same time we decided we could not buy in Florida, when, in reality, it was exactly the time we should have.

If only we can see the end at the beginning.  

So, what's going on in Ft. Myers Beach, so that all the older places haven't been bought, bulldozed, and given way to spiffy new places?  Some have, but many more old places are still there than other nearby areas.

You can go up and down the street in Vanderbilt Beach, or along Hickory Blvd., and those old places are almost all gone.


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## grest (Jan 18, 2008)

Dottie said:


> I live in Florida and as yet am undecided on the Nov 29 Homestead changes.  They say they will need to make up revenue somewhere.  My question is why and what have they been doing with all of the extra income they have received from all on the new homes and condos sold at inflated values over the last 3 or 4 years?  It would seem that they had much higher than normal revenues and those years there were no comments on how it was spent.  I then lived in ST Johns County which was building new schools like crazy and yes, they were needed.  I now live in Marion county where the school population is not growing the same but apparently the money is gone.  Why?  It they don't do something to convince me they are issueing empty threats about needing the money for services, I will vote for the exemption.



Hi Dottie,
I live in Ocala too, and work for an alternative school where we serve somewhere around 270 students the "regular" schools don't want to deal with, from first grade through high school.  There are at least two or three other such programs in the system.   In our school, teachers have no computers nor internet access, for example.  Nor do the kids...how can we not teach them this technology??? Also, we have not seen a raise this year, nor cost of living increase.  Our school system is behind most of the counties in Florida.  Oh yes, we do need the money.
Having said that, I haven't yet decided on the homestead exemption, but am leaning against, just because it doesn't seem like it will fix a problem at all...a bandaid is not the solution.
Nice to see another Ocalan here


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## KenK (Jan 18, 2008)

As most here realize, the RE Tax %age varies by county in Fl.  So each county may have a slightly different %.   As Steam noted, in S Fl, it is close to  2% of the value of the home.  For a family that qualifies as a Fl residient, the value & % of rise is controlled ( Save Our Homes).

      But the newcomer Fl resident still starts their RE Tax at what they purchased their house for ( In Broward...as we were warned).

      The differences....

       We are currently in the condo my mom left us.  Its value has come down a lot, probably now about $200,000 from $269,000 last year.  I expect realistic, & sell it now would be about $175.00 ( 1 bed 2 bath 1050 sq ft NFB 30 + Yrs interior parking)

       Our neighbor who has lived here since our family bought ( 1971 new) pays just under $500.00 a year RE Taxes.  We pay ( no Save Our Homes, non resident) just under $4000.)

     What everyone is quite silent about here was the elimination of the 1% + tax on property ( mainly investments some possessions) when the families assets were over $1,000,000.  Shhhh!   ( Maybe one of the Florida full time residents might know more about that quietly removed)  Yes....it brought in plenty...

    I expect the more we save on federal taxes, the more the states will be responsible for running things.  I think this will also result all states having an income tax.  

    Dade is now pushing to pass laws so they can have non-Indian gaming.  It will help, it will help.  I doubt it.....see how great it helped AC?  And last year, they started this in Broward.....every one of thhigh on meds  em is yelling they are not doing well.   ( Maybe the required 85% payback is too high?)  I don't think gaming helps build up funds at all.  Costs too much to provide a first class operation people with the $$$ expect.    


     Many of the T/S weeks have pretty high taxes & insurance costs ...  This may hurt the resales and keep resale pricing lower than in other areas.


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## Steamboat Bill (Jan 18, 2008)

KenK said:


> What everyone is quite silent about here was the elimination of the 1% + tax on property ( mainly investments some possessions) when the families assets were over $1,000,000.  Shhhh!   ( Maybe one of the Florida full time residents might know more about that quietly removed)  Yes....it brought in plenty...



I think you are referring to the Florida Intangible tax that was eliminated (thankfully). 

This was a silly tax that affected only a few people with assets over a certian threshold. It was stupid as I had to pay tax on something I already bought (paid tax on my income to buy it and then sales tax on the purchase) and I had to pay that tax every year. It was not a lot of money for me, but the accounting fees and paperwork costs was more that what I paid in the tax. In the grand scale of things, it was a small blip on the tax radar for Florida.


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## Dottie (Jan 18, 2008)

Thanks Connie--your info is interesting.  I wonder where all the money does go from all of the new homes.  The other thing is, as I understand it, there will be no decrease in school monies since the school tax is not going to be homesteaded.  The only effect seems to be from the portability of the tax which will be for future movers.  That should not have an immediate effect.  I do agree that the kids and teachers need computers and the teachers do need raises in order to be able to stay here and teach.


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## rapmarks (Jan 18, 2008)

steamboat Bill, how did you pay sales tax on something that was intangible?  The intangible tax was on stocks, bonds, mutual funds, etc. , I don't believe it was on boats or cars or personal property.   the form was pretty simple too., value of your stocks, bonds, etc, minus the deduction (which was up to 500,00 for a married couple, times 1% or 1/2 % later.   
Frederica Cosper, from the state revenue department,said at both workshops I attended, that the tax cost more to administer than it brought in.  
I asked her how they would know if someone didn't pay it properly, she said they would find out when the person died and left an estate that was larger than they had been paying intangible taxes on.

I know that I started getting a note from my brokerage firm that my account information had been sent to the state of Florida, so i wouldn't take the risk to not file.  Jed Bush was against it and got it repealed.    


I also agree with Sea six that much of the cost of living is less here in Floria than up north, the insurance is a lot higher than the midwest, but electricity, phone, property tax is less.


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## jfitz (Jan 18, 2008)

JLB said:


> jfitz:
> 
> So, what's going on in Ft. Myers Beach, so that all the older places haven't been bought, bulldozed, and given way to spiffy new places?  Some have, but many more old places are still there than other nearby areas.
> 
> You can go up and down the street in Vanderbilt Beach, or along Hickory Blvd., and those old places are almost all gone.



Supply and demand; Fort Myers Beach does not have the cachet of Bonita Springs or Naples, probably never will.  Those in the market to build McMansions or luxury condos tend to gravitate southward and away from Fort Myers.


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## Steamboat Bill (Jan 18, 2008)

Dottie said:


> I do agree that the kids and teachers need computers and the teachers do need raises in order to be able to stay here and teach.



check this out
http://www.sun-sentinel.com/news/local/southflorida/sfl-flfed0118sbjan18,0,2080195.story



rapmarks said:


> steamboat Bill, how did you pay sales tax on something that was intangible?  The intangible tax was on stocks, bonds, mutual funds, etc. , I don't believe it was on boats or cars or personal property.   the form was pretty simple too., value of your stocks, bonds, etc, minus the deduction (which was up to 500,00 for a married couple, times 1% or 1/2 % later..



You are correct....I pay so much tax that I get confused. I paid Intangible tax on my stocks/bonds, etc as a personal return and I also paid Intangible tax on my two businesses assets like computers, furniture, etc. Thus, I am really paying 2x or 3x or something like that.

If I could eliminate the all money I spend on taxes and insurances, I would be one happy camper.


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## The Conch Man (Jan 18, 2008)

I,m not in total agreement - since we built & moved to our home here in 2005 from Southwest Ohio & living on a retirement pension, the cost of living here is way more than compared to living up North. We use to pay State, City & local tax, Real Estate tax & Home & Auto insurance which doesn't compare with living here. Our insurance for both home & auto back then cost us an average of around $2,000 per year & we lived in a community where many people couldn't afford to live.

The cost for insurance here in 2005 cost us around $4,000 per year & the taxes on our home was around $6,000 compared to our home up North of almost equal value for around $2,000 per year. I know that Florida doesn't have a State tax but to live in Southwest Florida is very expensive, even the booze & cigars are out of sight here than what I paid up North. I can understand what ya say but I'm not sure its cheaper to live here than where we use to live but we are here cause of the weather year round & the hotter it is here the better we like it!

Forgot to mention that we have a pool as well (14 x 28) but it cost us a little more than you are paying, just under $220 during the heat of summer & we have around 1,800 sq ft of living space to cool. I'm not going into the gas prices here cause their reasoning is, it cost more to transport gas down here!



Sea Six said:


> I'm with you on that statement. I've been following this thread for some time and just don't agree with most of it. When I worked in Philadelphia, I paid a 3.3% wage tax, a 3.2% state income tax, and a 6% sales tax. Down here there is no city wage tax, no state income tax, the sales tax is the same, and my property taxes (considering the relative value of my homes) is still lower in Fla than it was in PA. My home in PA was homesteaded just as my home in Fla is now, but the taxes are still lower and my home is worth more. I have yet to meet anyone who moved here from the bigger Northeastern cities of Virginia, PA, New York, or especially New Jersey, who think their taxes or insurance are worse here in Florida. My neighbor says his car insurance alone more than makes up for any difference, let alone the ridiculous rates people pay for real estate taxes in New Jersey. My electric bill during the winter used to be over $300 in PA, now in the heat of summer with the A/C and pool running I may see a bill for $180. I just don't see these cost items being discussed as unique to Florida, except for the flood insurance if you happen to live in a flood plane like I do, but that is to be expected - the risk is certainly higher. Overall, our cost of living is considerably lower than it was up north.


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## grest (Jan 18, 2008)

Dottie said:


> Thanks Connie--your info is interesting.  I wonder where all the money does go from all of the new homes.  The other thing is, as I understand it, there will be no decrease in school monies since the school tax is not going to be homesteaded.  The only effect seems to be from the portability of the tax which will be for future movers.  That should not have an immediate effect.  I do agree that the kids and teachers need computers and the teachers do need raises in order to be able to stay here and teach.



Makes you wonder, doesn't it???  I wish the new construction would stop for a while...
Connie


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## Sea Six (Jan 18, 2008)

The Conch Man said:


> I,m not in total agreement - since we built & moved to our home here in 2005 from Southwest Ohio & living on a retirement pension, the cost of living here is way more than compared to living up North.



I don't doubt your costs in Fla may be higher than southwest Ohio.  I'm saying that the cost for those of us from the big city areas of Baltimore, DC, Philly, NY, etc, are much lower. The whole subject is relative to where you came from, and it does not mean that the cost of living is HIGH just because it is higher than where you came from.  If you moved from SW Ohio to northern NJ you'd be in even bigger culture shock, and the effects of "homesteading" are also not unique to Florida since the same issues exist in other states.  Florida is not the only state that offers this. When I lived in PA, I realized it would cost me more in taxes to move into a different house of the same value, but I also did not forget all the savings I got during the time I homesteaded my house until I decided to move.


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## Vodo (Jan 19, 2008)

*It's All About Portability*



Don said:


> The new version of the Homestead act that will be voted on contains a portability provision.



The portability provision is actually the most critical component of the proposed act.  The small tax savings from the additional $25,000 in homestead tax-exempt value is nice, but not particularly important in the grand scheme of things -- and you don't actually even get full exemption on that second $25,000 because school taxes are paid at full freight beyond the original $25,000 base exemption.  The Save Our Home portability, however, can make a huge difference.

As an example, if you purchased a homestead several years ago with a tax-assessed value of $200,000, you would have paid taxes that first year on $175,000 (the tax-assessed value less your $25,000 homestead exemption).  The next year, and every year thereafter, no matter how much your property's assessed fair market value may have increased, the amount on which you paid property taxes could increase by no more than the 3% annual Save Our Homes cap.

The problem with the Save Our Homes strategy was that if you wanted to sell that home after a relatively lengthy period of tax-capped time, you would pay full taxes on the value of the replacement home.  This was locking people into staying in homes they might otherwise have sold and upgraded from.  That's where the portability provision comes into play.  With portability, if you sold that house that you paid $200,000 for so that you could buy another home anywhere in Florida, you would take with you, or "port", a tax exemption of the difference between its current fair market value and its current tax-assessed value.  For example, if the house you sold had a fair market value of $500,000 and your tax-assessed value was only $250,000 because the Save Our Homes 3% cap had kept tax assessments in check for several years, you would "port" $250,000 of tax exempt value to your new Florida home (assuming it was assessed at the same or more than your old home).  Let's say your new home had a tax-assessed value of $600,000.  Your assessed value on that home -- the amount on which you would pay property taxes -- would be only $350,000 because of the $250,000 exemption you "ported" from your previous home.

While I don't plan to sell anytime in the near future, I would surely want portability if I ever did.  I'm voting yes on the proposition for that reason alone.

Of course, if someone moves here from another state, portability doesn't apply at all.  Additionally, if you bought a lesser value home than the one you sold, you would receive only a proportionate percentage of the "ported" exemption.  The maximum amount you would be able to port would be $500,000.  If the proposal passes, you would have two years after selling your homestead to purchase a new one or your portability would lapse.  Lastly, the portabillity component would be retroactive to 2007, so many Floridians would see an instant benefit.

Oh dear, I really didn't mean to ramble on for so long.  I apologize to anyone I've put to sleep.  :zzz: 

Cindy


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## JLB (Jan 19, 2008)

Since Estero Blvd and Hickory Blvd are the same road, not far apart, I am taking this to mean that the _market_ has elected to keep FMB a less desireable area.  

On _South_ FMB, it appears that the _market_ has elected to knock down the old stuff and put up the new.



jfitz said:


> Supply and demand; Fort Myers Beach does not have the cachet of Bonita Springs or Naples, probably never will.  Those in the market to build McMansions or luxury condos tend to gravitate southward and away from Fort Myers.


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## The Conch Man (Jan 19, 2008)

Thanks Cindy for your explanation on our situation here in Florida, was very good reading & an accurate statement.

I know you were talking bout other "High" States Six but I was stating the affect on people who didn't come from a "Area" State & for the most part, people who are trying to make a living here in Florida, not us. Lee County is very high in their taxes, higher than Collier County which Monroe County is the highest & Lee follows close & is the highest, I think, in Home & Auto Insurance. We are thinking bout moving to Collier County to save a little money!


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## jlwquilter (Jan 19, 2008)

I can't edit my post any longer but did want to correct a mistake/typo I made, even though slightly off topic.

The tax rule for not having to pay federal capital gains tax on the profit from a sale of a former _primary_ residence is that you have to have lived there (ie: as primary residence) for TWO (not 3 as I previously posted) out of the preceeding 5 years. As this is for former _primary_ residences, pure rental/commercial properties do not qualify.


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