Looking to relocate somewhere sunny? If you’re looking to get a tan, eat great Cuban food, and aren’t worried about traffic jams, then The Magic City could be the place for you. But, get ready to open your wallets. On average, renters shell out $1729 a month. Of course, what you pay varies by neighborhood. Overtown reported one of the lowest average rents at $1000 a month, and the bustling West Flagler saw higher average rents of $2407. All of these numbers might look a whole lot better than the average rent in Boston (a hefty sum of $3111), San Francisco, or San Jose. However, it’s a few hundred over the national average of $1,465, and many South Floridians are facing a growing affordability crisis. It’s recommended to pay no more than 30 percent of your income on housing. Over half of South Floridians overextending– A new report from South Florida has found that six in ten employed adults are dishing out over 30 percent of their monthly income on rent.
How come rent’s soaring and Floridians can’t keep up? Let’s take a look at why Miami is facing an affordability crisis and what Floridians can do to combat it.
High Levels of Tourism
With its warm beaches and international reputation for nightlife and good eats, Miami is a choice vacation-spot for tourists from the United States and abroad. However, the Sunshine State’s booming tourism industry fuels the affordability crisis. Many tourism jobs that employ local Floridians are not full-time. This work doesn’t yield the type of high incomes that allow Miami residents to spend only 30% on their monthly housing. However, Miami’s hot tourism industry escalates the prices on everything, from food to amenities. Housing feels the heat, too.
A Tale of Two Cities
In 2010, LeBron James announced that he would be “taking [his] talents to South Beach,” and, in the process, drew ire from Miami residents who know that South Beach ≠ all of Miami. However, he unintentionally proves a point. The Magic City seem to be divided into the super-rich tourists, snowbirds, and celebs of South Beach, and, on the mainland, Floridians of more modest means. But, of course, Miami’s not really two cities and price hikes on exclusive apartments impact real estate across the board for all residents. The higher prices put on the rentals for New Yorkers looking for tax havens, or celebrities hoping to score beachside views escalates the costs of all buildings.
Building the Wrong Thing
To capture the influx of high-rolling renters, builders are creating luxurious condos. However, these swanky high-rise condos sit largely uninhabited and take up valuable land that could be used to produce affordable housing that’s accessible to more residents.
Increased Demand and Fewer Home Sales
But, people still want to live in the Miami area. Demand is up. But, renters who can’t buy homes find themselves in a double-bind. Rising home prices increase demand, and higher home prices escalate rentals even further. Given a choice, many Floridians decide that renting makes more economical choice, even with price hikes.
What can Floridians do?
Apart from sticking it out and waiting for builders to create housing that’ affordable, here’s what Floridians are doing about the affordability crisis.
Nobody likes sitting in traffic all day, but a long commute can beat an unaffordable rent. More and more South Floridians are becoming super-commuters— opting to work in Miami and sit in traffic for over an hour and a half in between work and home.
Get a Great Real Estate Agent to do Their Research for Them
Real estate agents can offer super valuable area expertise to help find their clients an apartment at the right price point for them!
The good news for real estate agents is that people are still looking for rentals in Miami. Our database of over seven million MLS listings not found on the MLS covers the Miami-Dade area and provides agents access rentals at all price ranges. The more options, the more opportunities to match your client with a rental they’ll love. Check out five Rental Beast approved listings in Miami area here.
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