“Rent is so expensive, I have trouble finding anything”. This is what we hear on a daily basis in Miami lately. In today’s renting situation, households across Florida have 2 options: increase their rent while reducing their lifestyle and diminishing the budget allowed for savings/pleasure or leave further away from Miami.
During Covid, the whole planet was on “pause”. The entire economy was kind of holding on to see what would happen next. Well, what’s happening is definitely unprecedented. Dade-County has reached this month, the highest price level since the pandemic, with a 40% increase. This phenomenon alone will keep inflation levels elevated through the year forcing families to reassess their living situation. In Miami, some renters have seen their rent jumping from more than 50% this year, for households that can afford the increase, it’s still less money toward a potential down payment. It surely raises a lot of questions when it comes to choosing between renewing the lease at a higher rate, leaving the premises, or actually buying a place and spending the rent amount towards a mortgage.
We’re witnessing a wide gap between supply and demand, which generates this unprecedented price increase. Before the pandemic, rent was increasing at an average of 7% per year.
The inequalities within our community have been exacerbated by the pandemic, on different levels and areas of life. One thing is for sure: housing is included.
When it comes to homeowners, they have room to ask for more money, whilst on the other hand, renters are reaching their limits. The inadequate supply of homes is obvious in South Florida where salaries are rising slower than the rent prices. For many Floridians, it makes life very unsure, especially for the lowest-income families.
Even though the Biden administration vowed for 100,000 affordable homes to be provided in the next 3 years, it sounds like the lack of units is urging, now. The following number is getting out of control: 1 in 4 renters are spending more than half of their income on rent. The little leftover covers for groceries and basic needs for hundreds of families.
Households across the county are exploring options to be able to survive in this sharp market. In South Florida, options to move further from the Downtown area are quite limited since the State is surrounded by water. Shared housing solutions are becoming trendy again, but not out of choice. For thousands of residents, it’s the only option to live in a decent place and share the cost.
For those willing to buy a property, it's another topic. Inflation is astronomical this year, buying a house can sound like a dream unless you hold on to intergenerational wealth. Adding up to the struggle to become homeowners, cash buyers are taking over the market listings, therefore conventional buyers don’t even stand a chance!
With home prices and mortgage rates both on the upswing, South Florida which was once an inexpensive state in the US, is now off the table.
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