Commercial real estate industry insights.

New Legislation Seeks to Bolster Florida’s Affordable Housing Opportunities 

by Mary Ann Barnett, MAI, Lee Smalley, MAI and Anthony Bonet, MAI | Oct 26, 2023

Florida’s real estate industry and many of its residents are pinning their hopes on recently enacted legislation designed to make more housing affordable in the Sunshine State.

According to a Tampa Bay Times article, the lack of affordable rental properties has “placed a squeeze on Floridians, with more than half of all renters spending at least 30 percent of their income on rent.”

In late March, Gov. DeSantis signed Senate Bill 102 – known as the Live Local Act – which went into effect July 1, 2023. The legislation approved a record $711 million for “innovative projects that provide affordable and attainable housing” for those working, going to school or residing in the state.

Legislation Spurs New Approach to Affordable Housing

The two largest components of the act are tax exemptions and zoning bonuses.

Tax exemptions are available under the act for proposed properties or those built within 5 years of application submission.  Properties must offer workforce or affordable housing, and at least 71 units must be restricted. If the property self-restricts units serving tenants making less than 80% of the area median income, then the property will qualify for a 100% property ad valorem tax exemption. If the property self-restricts units serving tenants making less than 120% of the area median income, then the property will qualify for a 75% property ad valorem tax exemption The exemption is available annually upon re-certification of compliance by the state agency.

The Live Local Tax Credit Program will impact proposed development projects in densely populated parts of Florida. The legislature intends for these funds to be used for “innovative projects that provide affordable and attainable housing for persons and families working, going to school or living in the state.” Land-use attorneys say the act’s passage has already revamped developers’ approach to affordable housing in South Florida.

Zoning bonuses are the second major component of the law, requiring that municipalities approve the development of multifamily units on sites that are zoned as mixed-use residential, commercial or industrial. To qualify, a proposed development must have 40% of the units designated as affordable to those making up 120% of the local area median income (AMI) for a period of at least 30 years.

Another zoning bonus included requires a municipality to apply the highest allowed density on land within its jurisdiction to the proposed development. Additionally, the maximum height of a multifamily residential project is based on the highest currently allowed height for commercial and residential development within one mile of a multifamily development. The act also requires that a local government permit the project to be built, at a minimum, to a height of three stories. The density and height components have met with opposition from some municipalities.

Anticipated Effects

The law is expected to bring some financial relief from higher building costs and interest rates, blamed as primary reasons for delaying or canceling many of the state’s housing projects. The legislation also ended the state’s long-running practice of using funding designated for affordable housing for other uses.

Timing of new act is critical, as Florida’s rapid population growth shows no signs of retreating, further straining its shrinking affordable housing supply. With more than 22 million residents, Florida is ranked as the third most populous U.S. state, according to Census Bureau figures.

BBG Can Help Maximize Benefits of Affordable Housing Law

BBG’s expertise in appraisals and intimate knowledge of the Florida real estate market can assist developers, and others involved in the state’s real estate market in maximizing the benefits of the Live Local Act.

BBG is currently working on several of the first acquisition projects being submitted to Freddie Mac which are being acquired for the purpose of meeting the requirements of the Missing Middle portion of the law. The properties will be self-restricting and pursuing annual certification to provide affordability where it wasn’t offered previously and providing tax relief for ownership which enables the project to be viable.

Additionally, BBG offers highly detailed market rent studies that property owners and developers are required to submit to the FHFC in order to qualify for property tax exemptions under the new law. The FHFC certification process requires these studies to be conducted by an independent, certified general appraiser every three years.

BBG also has market-leading expertise in zoning regulations and related services that will also help clients achieve their goals in creating essential affordable housing opportunities in Florida. For more information, please contact