It is no secret that just like mortgage rates, rental prices are continuing to rise. The prices do eventually come back, however for the time being, we are at the mercy of those able and willing to pay top dollar.
For example, for my own rent in Brickell I am paying $3,200/month until June. However, I have been informed that my rent will be increasing to $4,500 if I wish to renew. Before I could answer (which was going to be a “no!”), they ended up selling the unit for a good profit from what it was purchased for a few years earlier. Either way, I was going to end up back at the mercy of the “north-easterners” coming down and paying above market rents. I am hoping to find a 2 bed for less than $4,200 in Brickell (If you know a guy, let me know!). There is currently a low supply of rental homes and an incredibly high demand, with almost 1,000 people moving to Florida every single day. In 2021, we saw a net increase of 12,000 jobs added to Palm Beach County, so that is 12,000 more people than we saw the year before. Dr. Brian Strow, longtime resident of Florida, gave his insight. “People are saying, ‘The rents are so high, nobody can afford those.’ But the opposite is actually true. So many people can, and are willing to afford these rents,” stated Strow. As properties increase in value, the only way an owner can recoup those costs is through charging higher rent to their tenants. Landlords who were having trouble evicting during the pandemic have even bigger bills…
It is definitely an unsustainable market in terms of purchasing or renting, so we will not see another 57% increase year over year in rents like last year. However, we do not see too much of a correction downward, so the best we can hope for is a plateau!