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Today’s entry: Brian, you’re quite the cheerleader for Florida, which don’t get me wrong I appreciate, but we all know we have problems. I’d like to challenge you with discussing what you feel is the biggest problem our state faces right now and what you think should be done to address it.
In part one we talked and property taxes and that takes us to Florida’s property insurance costs, already the highest in the nation, have risen 35% over the past five years. A rate that’s greater than three times the national average. And that’s before the additional hit Floridians are taking for flood insurance. Much of that can’t be helped. We live where we live, and the risk of storms and flooding is truly part of the cost of paradise. It is, however, along with property taxes, creating a carrying cost burden that’s increasingly unsustainable. Add in the record-high inflation of everyday life all around us and that’s a recipe for real challenges. Now you also asked me what I’d do about it.
Starting with insurance, hopefully, the important work has been done. Floridians hold 7% of the property insurance policies in the country yet we’ve accounted for greater than 60% of the property insurance lawsuits in the country. It’s insane. We all end up paying much more than we should for scam artists that come in the form of homeowners, contractors, and attorneys alike. The good news is the Assignment of Benefits Reform has been passed into law. It just hasn’t fully kicked in yet and will be phased in through 2023. That should help. While we wait to see how the reform works my best advice is to attempt to pay your home off and have the option to only carry as much or as little insurance as you’d like as opposed to carrying the coverage a mortgage company mandates. Regarding property taxes...
I’ll start by saying I don’t believe in them. If you’re forced to pay taxes for the property you own or the government takes away your property, do you really ever own it? Aside from that philosophical argument, I believe property tax increases should be tied to inflation as opposed to property-assessed values. The cost of operating a city, a county, our schools don’t change based on property values. They change based on inflation.
Prior to this year (and our property taxes are based on last year’s assessments), the total five-year inflation rate was 8.9%. During that same five-year period South Florida’s property taxes rates increased about 35%. And that's just the past five years. That should never happen, but it does. Now we do play a role in this. Our local governments could cut our mileage rates and return the excess funds to us, but they almost never do. I’d like to see reform passed tying property tax rates to inflation as opposed to the increase in property values. We should always error on the side of homeowners over the government.
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