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Business Observer Thursday, Oct. 13, 2022 1 month ago

On the rise: Some Florida markets remain national leaders in apartment rent increases

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While there are signs of the trend slowing, Hurricane Ian may change that.
by: Louis Llovio Commercial Real Estate Editor

In what will come as a surprise to few, Florida leads the country when it comes to how fast rents are rising.

According to data gathered by professors at Florida Atlantic University, Florida Gulf Coast University and the University of Alabama, in August Miami had the largest rent increases in the country, bumping Cape Coral-Fort Myers which held the title the previous month.

The Waller, Weeks and Johnson Rental Index uses Zillow’s Observed Rental Index to determine existing rents and statistically model historical trends from 2014, according to the report. The index covers the entire rental stock of homes and apartments.

Miami renters paid 21.92% more than they did a year ago. The average rent in the city was $2,910. That compares to the national average rent of $2,098.78.

Cape Coral-Fort Myers’ numbers didn’t change in August, but its rents are 21.61% more than a year ago. The average rent at the time of the report was $2,168,48.

Nationally, the average rent is $2,098.78, up 12.64% from a year ago.

In all, Florida had six localities on the list of fastest rising rents in the country.

But Shelton Weeks, a professor of real estate at Florida Atlantic’s school of business, says there are signs of the trend slowing. For example, Miami’s increase happened mostly between September 2021 and February. He says rents are only up 6.8% in the past six months “implying a slowdown in the pace of rent increases.”

Hurricane Ian could change that trajectory in the short term, however. The area was already facing a shortage of rental housing and the construction to address that problem is likely to slow down because of issues brought on by the storm. This, the report says, could force “rents even higher near landfall areas, if only temporarily.”

Florida is not alone in the rapid increase of rent. Arizona, North Carolina, Tennessee, Texas and Utah also had localities topping the list of highest year-over-year rent increases.

On the flip side, the report found the lowest year-over-year rent increases were in Fresno, California, at 3.5%; Spokane, Washington at 4.2%; and Minneapolis at 5%.

 

 

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