The Sunshine State is an increasingly bleak place to be a renter.
Annual rent increases in several Florida cities ranked among the country’s highest in April, according to a recent analysis of 107 rental markets from researchers at Florida Atlantic University, Florida Gulf Coast University and the University of Alabama. In fact, only two of the nation’s 10 leading rental markets could be found outsideof Florida. They were Sierra Vista, Ariz., and Knoxville, Tenn., which ranked fourth and seventh in year-over-year rent increases, respectively.
“For some people, renting was the only way they could afford to live in Florida, and now that’s becoming a burden, too,” Ken H. Johnson, an economist at Florida Atlantic University’s College of Business, said in a statement this week. “I think you’ll see more renters take on roommates and cut back on eating out because it’s either that or they won’t be able to pay the rent.”
Fort Myers saw the nation’s biggest surge in rents — a 32.4% increase from a year prior — pushing the average rent up to $2,073 in April, the researchers said. Miami’s metropolitan area had the distinction of being “the most overvalued market.” Rent prices there hit $2,846 in April, while “historical leasing figures indicate the average should be only $2,331,” the researchers said.
In an announcement about their analysis, the researchers blamed Florida’s woes on increased demand, supply chain issues, the rising cost of building materials, and, in some areas, a lack of available property to develop. The state also experienced a population boom during the pandemic.
But the problem isn’t new. Orlando, for example, has had a shortage of affordable rental housing for years. And it’s not necessarily unique to Florida, either. Various cities have been described as having the biggest annual increase in rents in recent months, and Portland, Ore., saw a 40% increase in median asking rents from March 2021 to March 2022, according to Redfin.
“The way out of this is to add more rental units to the marketplace,” Bennie Waller of the University of Alabama’s Alabama Center for Real Estate said in a statement. “But it’s just not realistic to expect a bunch of new projects in the near term, given the supply chain problems and the often slow pace of government approvals facing developers before they can put a shovel in the ground.”