Desperate Florida renters are 'downsizing or downgrading' as price increases top the nation
Crushing rent increases put eight Florida regions, including Palm Beach County, into the top 10 nationwide for priciest hikes since last year, leaving Sunshine State residents and businesses in a housing bind with no quick fixes.
An April review by Florida Atlantic University of 107 major real estate markets lists Fort Myers as having the top rental cost surge at 32.4% compared with the same time in 2021. Southeast Florida — Palm Beach, Broward and Miami-Dade counties — was a close runner up with a 31.7% increase.
It means the average rent in Fort Myers in April was $2,073, according to the study. The average rent in southeast Florida hit $2,846.
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The study, which was released Monday and includes work from Florida Gulf Coast University and the University of Alabama, researched prices for homes and apartments, and included all sizes of rentals.
Following Fort Myers and southeast Florida, other state markets in the top 10 included Sarasota-Bradenton with a 30.9% increase, Tampa (27%), Port St. Lucie (25.5%), Lakeland (24%), Orlando (23.7%) and Melbourne (22.5%).
Only Sierra Vista, Ariz and Knoxville, Tenn., broke up Florida’s stronghold in the top 10 for the highest rent hikes last month.
“I do see a handful of people who say their rent is going up $1,000 and they are downsizing or downgrading to find something more affordable,” said Chris Luciani, leasing manager for Florida Management Consulting Group, which handles about 200 properties in Palm Beach and Broward counties. “The competition is pretty severe right now.”
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Lack of rentals could curb Palm Beach County economic growth
Affordable housing was the subject of a summit last week where Palm Beach County business leaders said the lack of rentals was beginning to curb economic growth as companies wanting to relocate to South Florida put plans on hold until prices come down.
Researchers involved in this week’s study said that’s not happening soon.
“The way out of this is to add more rental units to the marketplace,” said University of Alabama real estate professor Bennie Waller. “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.”
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Markets with the lowest annual rent increases include Minneapolis-St. Paul, Madison, Wisc., Des Moines, Iowa, Honolulu, Hawaii and Milwaukee, Wisc.
A recent study by Apartmentlist.com that looked only at apartments found southeast Florida had the highest rent increase over the past 12 months at 28% with Orlando coming in second and Tampa in third place.
Since the beginning of the pandemic in March 2020, Tampa ranked tops for rent increases nationwide at 40%. Southeast Florida was third at 36%.
“Rent prices are still growing faster than they did pre-pandemic but slower than last year,” said Rob Warnock, senior research associate for Apartmentlist.com. “There is a little bit of a course correction, but it's still getting more expensive and as far as states go, Florida is still at the top of the list.”
This article originally appeared on Palm Beach Post: Florida rent increases top the nation with no quick fix in sight
