Miami Luxury Real Estate Taxes: Property Taxes, Homestead & What Buyers Pay

One of the first questions serious buyers ask me is what they will actually pay to own here each year. Miami luxury real estate taxes are very manageable compared with many high-cost markets — Florida has no state income tax — but property taxes, exemptions, and assessment caps work differently depending on how you use the home. Here is what you need to know before you buy.

Quick answer: In Miami-Dade County, annual property taxes generally run in the range of roughly 1.8% to 2.2% of assessed value, depending on the city and millage. Primary residents can claim a homestead exemption and a 3% annual cap on assessed-value increases, while second homes and investment properties are capped at 10%. Florida has no state income tax.

How Miami Luxury Real Estate Taxes Work

Your property tax bill is based on the assessed value of the home multiplied by the local millage rate, which varies by municipality. Coral Gables, Pinecrest, Key Biscayne, and the City of Miami each set their own rates, so two homes at the same price can carry different bills. You can look up any property and its current assessment through the Miami-Dade County Property Appraiser.

As a planning guideline, budgeting around 2% of value per year is a reasonable starting point for a luxury home, and I always pull the exact figures for any property before a client writes an offer.

The Homestead Exemption and the 3% Cap

If the home will be your primary residence, Florida offers two meaningful benefits:

• Homestead exemption — reduces the taxable value of your primary home by up to $50,000.
• Save Our Homes 3% cap — limits how much your assessed value can rise each year to 3% or the rate of inflation, whichever is lower.

Over time, that 3% cap is the bigger benefit. In a rising market, it can hold your assessed value well below market value, keeping your tax bill predictable year after year. There is also portability, which lets Florida homesteaders carry accumulated savings from one primary home to the next.

Update, September 2026: Florida voters will decide on Amendment 3 on November 3, 2026. It would raise the non-school homestead exemption to $150,000 in 2027 and $250,000 in 2028 and lower the cap on non-homestead assessments from 10% to 5%. Our Florida Amendment 3 guide explains what it would change for Miami owners.

What Second-Home and International Buyers Pay

Many of my luxury buyers are purchasing a second home or an investment property, or they live abroad. In those cases, the homestead exemption and 3% cap do not apply. Instead, non-homestead properties are subject to a 10% annual cap on assessed-value increases (excluding the school portion). You will still pay based on assessed value and local millage, so budgeting around 2% is prudent.

If you are an international buyer, taxes are only one part of the picture. Be sure to also understand FIRPTA withholding when you eventually sell, and your financing options if you plan to use a mortgage.

How to Budget for Miami Luxury Real Estate Taxes

Here is the approach I walk clients through:

• Pull the property’s current assessed value and the municipality’s millage rate.
• Remember that a sale often triggers a reassessment closer to market value the following year, so the prior owner’s bill may understate yours.
• Factor in insurance and, for waterfront, flood coverage — these matter as much as taxes in your carrying cost.
• Decide whether the home will be homesteaded, which changes your long-term trajectory significantly.

None of this is tax advice, and every situation is different — always confirm the numbers with a qualified CPA. But with the right planning, owning a luxury home in Miami is often more tax-efficient than clients expect, especially compared with high-income-tax states.

If you are moving from one Florida homestead to another, read our guide to homestead portability in Florida to see how much of your Save Our Homes benefit you can transfer.

Frequently Asked Questions

Does Miami have property taxes?

Yes. Miami-Dade County property taxes generally run about 1.8% to 2.2% of assessed value depending on the municipality and millage. Florida has no state income tax, but property taxes fund local services.

What is the homestead exemption in Florida?

For a primary residence, the homestead exemption reduces taxable value by up to $50,000 and locks in a 3% annual cap on assessed-value increases through Save Our Homes. It does not apply to second homes or investment properties.

Do second-home buyers get the 3% cap in Miami?

No. The 3% Save Our Homes cap applies only to homesteaded primary residences. Non-homestead properties are capped at 10% annually on assessed-value increases, excluding the school portion.

How much are property taxes on a $5 million Miami home?

As a rough guideline at roughly 2% of assessed value, a $5 million home could carry an annual bill near $100,000, though the exact figure depends on the municipality, assessment, and any exemptions. Always verify with the Property Appraiser.

Is Miami tax-friendly for luxury buyers?

Generally yes, largely because Florida has no state income tax. Property taxes and insurance are real costs, but many high-net-worth buyers find the overall tax picture favorable compared with high-income-tax states.

If you want the exact tax and carrying-cost picture for a specific Miami property, I am glad to pull it for you before you make an offer. Reach me at (786) 801-4442 or through my contact page.

About Erika Schell
Erika Schell, P.A. is a Luxury Certified REALTOR® with The Keyes Company and a Forbes Global Properties affiliate, specializing in $1M+ residential real estate across Coral Gables, Cocoplum, Gables Estates, Key Biscayne, Pinecrest, South Miami, and Doral. With a Master’s in Finance, 20+ years of business experience, and 123+ successful transactions, Erika brings CFO-level pricing analysis and worldwide Forbes marketing to every luxury sale. Call or text (786) 801-4442. This article is general information, not tax advice.