Miami and Miami Beach have long enjoyed the status of being one of the highest rent-earners in Florida. But 2017 brings about a bizarre turn of events. For the first time in over five years, rents have gone down. Whether it’s Downtown, Brickell or South Beach, renters can now save hundreds of dollars a year as landlords hit a rough patch.
Numbers Tell the Story
According to Zumper’s 2017 Miami Metro Report, rents in Miami and Miami Beach have taken a hit. The report took into account over 56,000 active listings across 18 metro cities in South Florida for March. While Miami Beach’s one bedroom units are 10.5% cheaper, two bedroom-units are 8.5 percent cheaper. Both one bedroom and two bedroom units cost 5.3% lower to rent in the Miami metro area.
According to CBS local, historically Downtown rents would increase at least $100 every year. The rent was $2,255 in 2012, $2,371 in 2013, $2,481 in 2014 and $2,582 in 2015. But, the market fell flat in 2016 with rent going up non-significantly to $2,590. With a 3 percent decline in the average rent of one bedroom apartments, Miami was also at the bottom of the list on ABODO’s 2016 National Apartment Report.
What turned the tables?
Market experts mention that developers chose to build more apartments during the last recession. This shift in focus came as banks refused to finance condos in a falling market. As a result, there are now roughly 8,000 apartments waiting to hit the market. There are also those renters who are becoming buyers. Recovering from foreclosures during the last down cycle, their 5 to 7 years restriction on getting a home loan is about to end. This sudden increase in supply and fall in demand has affected rental pricing adversely. According to market experts, it will take about two to three years for the market to correct. Till then renters can rejoice