South Florida Renters Might Catch A Break Soon

South Florida has seen inflation reflected on rent costs, but a wave of new apartments might help keep the rent prices from soaring, according to a national survey. It’s a favorable sign for millennials and new arrivals who are seeking housing, as South Florida is ranked fourth nationally in the 2019 apartment construction segment, having more than 13,000 new units that are slated to go online by the end of the year. “As it usually happens, whenever the apartment supply is abundant, there’s a certain slowdown in rent growth,” said Florentina Sarac, a RentCafe analyst. 

Each month RentCafe analyzes the rent data across 260 of the largest U.S. cities. For July 2019 — the latest month where the rates are available — the average rent cost in Miami was $1,729, signaling a year-over-year change of $59. The average rent cost in Fort Lauderdale was $1,948, up to $58, while West Palm Beach was at $1,448, based on a relatively small year-over-year, an increase of $17. Miami’s monthly rent, which trails cities in Broward and Palm Beach counties, didn’t shoot up drastically, and that could be because “of the considerable number of apartments that the city built in the past years,” said Sarac. 

The only city in the region “to have witnessed the lowest rent increase between 2018 and 2019 – of 2.7%,” is Miami, Sarac said, citing data from Yardi Matrix, RentCafe’s survey arm. There are apartments of various types that are in the works, from shared living spaces to multifamily units in shopping malls. According to the Sun-Sentinel, Miami is building the most significant number of new apartments compared to any other state in the U.S., with 6,989 units which are expected to be supplied by the end of 2019. 

West of Miami International Airport is Doral, which will be adding 311 units. RentCafe calls Fort Lauderdale the most expensive rental market in South Florida at the moment, and it’s expected to add 1,343 new units to its inventory. Pompano Beach will add 471 units.

As for West Palm Beach, 695 apartments are in the works. However, it still needs to be seen if rent costs will ultimately decline in the face of the emerging new supply. Given the higher taxes happening in the Northeast, new residents keep arriving in South Florida, possibly canceling out the newly-available apartments. 

“We also noticed that [Miami’s] occupancy rate dropped from 97% in 2015 to 95% in 2019, meaning that despite the healthy boost in population — fueled by job growth, among other possible factors — Miami still has available units for new residents,” said Sarac. If the supply in Miami keeps up the pace with its demand in the following years, “the increase in rent [price] growth could continue to be moderate,” Sarac said.