Walter and Debbie Priebe thought they were securing the future of their cherished Pompano Beach, Florida, home when they undertook major renovations.
But after fixing termites, repairing the roof and adding a second story, their property tax bill exploded — from $15,000 to more than $90,000 a year.
The Priebes’ story — first reported by Realtor.com — highlights a growing risk for homeowners: Renovations can result in dramatic, unexpected tax hikes.
Why did their taxes skyrocket?
The Priebes had hoped that keeping their home’s foundation and exterior walls intact would let them maintain Florida’s property tax protections for homeowners — specifically, the homestead exemption and Save Our Homes cap, which limit how much a home’s taxable value can rise each year. These exemptions, in turn, limit how much a homeowner’s property taxes can rise each year.
Before starting work, the Priebes even confirmed this understanding with their county government.
But Florida law says that substantial improvements — like removing the roof and adding a second floor — can constitute new construction. That allowed the county to treat their home as essentially new, resetting its assessed value to current market levels and stripping away the caps on annual increases.
With recent neighborhood sales at record highs, the reassessment of the home the Priebes bought for $650,000 resulted in a new valuation of more than $4.4 million, pushing their yearly taxes beyond what they had ever anticipated.
What can homeowners actually do to avoid this?
If you’re considering a major renovation, don’t assume your property tax protections will survive, even if you maintain the general footprint and some original structure. Here are practical steps you can take:
- Consult the property appraiser’s office before making plans: Ask specific questions and request written clarification about how your proposed work might affect your assessment and exemptions. Be as detailed as possible about your renovation plans. Of course, the Priebes took this step, and it didn’t protect them. So, don’t stop here — take the following steps as well.
- Understand what counts as a substantial improvement: Cosmetic upgrades usually won’t trigger a reassessment, but additions or major structural changes could. In Florida and many other states, anything that significantly changes the home’s square footage, roofline or core structure may be treated as new construction.
- Get documentation in writing: If you receive guidance from officials, get it in writing for your records. Verbal assurances can lead to misunderstandings.
- Budget for a higher tax bill: If your project is extensive, consider conservatively estimating what your taxes would be if your home was reassessed at current market value. Use recent neighborhood sales as a reference point.
- Appeal if necessary, but know the limits: The Priebes tried to fight their new valuation using appraisals and receipts, but the law was clear in their case. Appeals work when there are factual errors, but can’t override state statutes.
The takeaway
Substantial renovations can help ensure your home’s longevity and comfort — but they come with hidden risks. Before you start, do your homework with your assessor or property appraiser, and plan for the possibility that your tax bill could change dramatically.
While the system isn’t always flexible, being prepared can help you avoid a life-altering surprise like the one the Priebes faced.
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