The homestead property laws in Florida can be challenging to navigate, as criteria must be satisfied for a homestead to qualify a property. If you’re interested in purchasing a Florida home, your real estate closing must take place by December 31 to qualify for homestead exemption the following year. Find out more about this law and why it should influence your closing date.

A Guide to Closing Dates & the Florida Homestead Exemption

What Is the Florida Homestead Exemption?

Owning a permanent residence in Florida may make an individual eligible for a homestead exemption, which decreases the property’s taxable value by up to $50,000 — depending on the value of the home. This applies only to residents within the state of Florida. Once the homestead exemption is established, it automatically renews each year.

How Does It Help You Save?

By decreasing the taxable value of the home, the homestead exemption allows homeowners to save a significant amount on their property taxes. Homestead properties also benefit from the state’s “Save Our Homes” cap. Under this provision, the increase of assessed properties cannot exceed 3% more than the value the home was appraised at the previous year.

Why Do You Need to Close Before January 1?

To receive a homestead exemption for 2020, your real estate closing must take place by December 31, because you’ll need to have established your Florida residency by January 1. While the application for the exemption is open until March 1, it only applies to individuals who establish their residency before the new year. Thus, if your real estate closing takes place on January 1, or later, you must wait until 2021 to reap the benefits of the homestead exemption.

If you’re looking for assistance to streamline the real estate closing process, turn to Scarab Title & Escrow Services. Serving New Port Richey, FL, this dedicated team specializes in title examination and insurance services to ease the transfer of property for commercial and residential clients. Browse their full list of services online or call (727) 378-4553 to speak with a team member.