South Florida’s housing market has become a veritable battleground for homebuyers and renters alike as the cost of living continues to soar. With the rental market skyrocketing and inventory remaining low, many residents are left to ponder what the future has in store for them in the region.
Alarmed citizens like Martie Maguire are terrified and incredulous about the current market state. “It’s frightening, it’s extremely frightening right now, there’s simply nowhere to go and the rental prices are off the charts,” Maguire said.
Orphe Divounguy, an economist with Zillow, revealed that while rental prices have lessened somewhat, they still remain unaffordable for many. According to Zillow’s February Rental Market Report, rent prices rose nationwide for the first time in five months, with typical asking rents standing at $1,976, which is 6.3% higher than a year ago, but still below the peak of $1,987 in September.
The report also uncovered a potential cooling pattern in South Florida’s rental market, with Miami seeing a month-over-month drop in rent prices. Nonetheless, Miami’s average monthly rent remains high at $2,760. Divounguy attributes this cooling trend to the Federal Reserve’s decision to increase interest rates, which has impacted housing market activity.
Inventory continues to be a significant issue in the area, as sellers are hesitant to put their homes on the market. “While buyers are beginning this entire shopping season with a bang, potential sellers were a bit slow off the starting blocks,” Divounguy stated.
Florida has become an attractive market for homebuyers, luring people from other states and even other countries. This increased demand is projected to continue driving up house prices in the area. Divounguy emphasized that a full housing market recovery will necessitate inventory levels returning to pre-pandemic levels.
For those seeking to purchase in South Florida, Divounguy advises finding a trustworthy real estate agent and getting pre-approved for a mortgage, which can give buyers an advantage over the competition.