7 Financial Reasons To Stay in Florida (Even Though It Can Be Expensive)
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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For decades, people have been settling in Florida because of a relatively lower cost of living compared to other parts of the U.S. and, of course, the excellent weather. However, as costs of living have risen across the U.S. and the state continues to attract people, particularly retirees, Florida isn’t really considered the low-cost state it once was.
While there are still affordable parts of Florida, such as Ocala, Pensacola and Lakeland, there are many more cities where the demand is sending costs well above the national average.
Despite those skyrocketing costs, here are seven financial reasons to stay in Florida.
No State Income Tax
One of the most appealing financial reasons to stay in Florida is that you won’t pay income tax here, thus keeping more of your income than in other states, according to The Tax Foundation. For contrast, if you earn $100,000 in a state like New York, you may pay between $6,000 and 10,000 in state taxes, but none in Florida.
Homestead Exemption and Property Tax Benefits
Florida also offers a “homestead exemption,” which reduces the taxable value of a primary residence by up to $50,000, resulting in lower property taxes, according to Aleks Grigoriev, a real estate expert and the co-founder of Sell My House Fast LV. Additionally, the “save our homes” cap limits how much a primary residence’s assessed value can increase per year (capped at 3% or the rate of inflation, whichever is lower).
“This protects homeowners from sharp tax hikes, even as property values rise,” he said.
Booming Real Estate Market
One thing you can almost count on in Florida is that any home or property you buy here will likely gain in value, Grigoriev said. “[Florida’s] real estate market has shown consistent appreciation, with home values increasing steadily over the past decade.”
He added, “With the state’s strong population growth — over 1,000 people move to Florida daily — housing demand remains high, making it a great place for homeowners and investors alike.”
More Affordable Luxury and Waterfront Properties
Compared to states like California, Florida offers more affordable luxury and waterfront real estate, as well, Grigoriev said.
“For example, a high-end oceanfront property in Miami may cost 40% to 50% less than a comparable home in [parts of Southern California],” he said.
Florida’s lack of state income tax also makes it financially attractive for high-net-worth individuals looking to purchase primary or secondary homes. “The combination of scenic beauty, favorable tax laws and real estate appreciation makes Florida a top choice for luxury buyers,” he said.
Retiree-Friendly Cost of Living
Another reason Florida is a top destination for retirees is that it doesn’t tax Social Security benefits, pensions or retirement income, Grigoriev said, and also offers a lower cost of living compared to many other coastal states.
“The lack of state estate and inheritance taxes further protects wealth transfer. Retirees can live comfortably while enjoying Florida’s warm climate, recreational opportunities and world-class healthcare facilities.”
Business-Friendly Environment
For all of the financial reasons mentioned so far, plus a few others, Florida has consistently ranked as one of the most business-friendly states in the country, according to Lead and Gain Workforce Solutions. Additionally, it has a low corporate tax rate (5.5%) and fewer regulatory financial burdens.
More Affordable Eldercare Services
Something fascinating that nobody talks about is that “Florida’s high concentration of older adults creates economies of scale for eldercare services,” according to Neal K. Shah, CEO of CareYaya Health Technologies.
He pointed out that more competition among providers equals better prices and better quality. “We see this clearly in the pricing data for home care services and innovations that are happening in the state.”
In addition, he pointed out that telehealth adoption rates and caregiver availability means that “Florida’s financial advantages go way deeper than just taxes. The state’s entire economic ecosystem is optimized for making retirement dollars go further.”
There are plenty of good financial reasons to consider moving to, or staying in, Florida, even if there are other “cheaper” states.
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