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Florida Amendment 3 targets property taxes, with implications for MSR values
The measure would raise non-school homestead exemptions to $150,000 in 2027 and $250,000 in 2028, which could reduce the escrow custodial balances that drive some mortgage servicing rights economics.
HousingWire reports that Florida’s proposed Amendment 3, framed as an affordability measure, could have knock-on effects for mortgage servicers through changes to property tax collections. The amendment is set to go before voters in November 2026, and would increase the homestead exemption for non-school property tax levies to $150,000 in 2027 and $250,000 in 2028, while leaving the school district exemption unchanged.
According to analysis by SitusAMC cited by HousingWire, reducing non-school property taxes could shrink the property tax funds collected and held in escrow accounts before they are remitted to local authorities. HousingWire notes this could pressure value drivers for mortgage servicing rights, including the custodial earnings that servicers generate from temporarily holding funds tied to monthly mortgage payments, payoff proceeds, and escrow collections.
HousingWire adds that taxes and insurance typically represent the largest share of custodial funds, and that the escrow mechanics matter because funds held during the remittance period contribute to the servicing asset’s economics. The outlet says Florida Amendment 3 would not affect homeowners insurance premiums or school district taxes.
HousingWire also reports that Florida Governor Ron DeSantis has estimated the higher exemption could eliminate a portion of the property tax bill for roughly 60% of homesteaded properties by 2028, with outcomes expected to vary by property and jurisdiction. The article concludes that a broad reduction in non-school tax collections could meaningfully alter MSR modeling considerations for servicers.