Miami is now the least affordable place to live in the US as average rents now rival New York City and San Francisco, new real estate data shows.
Prices have soared to nearly $3,000 per month this year as amid a mass migration of wealthy residents from the Big Apple and Silicon Valley during the pandemic.
The loaded remote workers are continuing to take advantage of the prime market and heading for the Sunshine State but local wages are yet to catch up.
Miami’s median monthly rent – currently $2,930 – calls for a whopping 60 percent of a tenant’s typical income – nearly 14 percent higher than that of LA, the city that thrusts the second-highest burden on renters, with 46 percent and an average rent of $2,993, according to Realtor.com.
The number serves as nearly double the amount deemed affordable for the average household by the real estate tracker, who said in their March report that the median income of those in Miami calls for a monthly rental price tag of just $1,476.
That figure is similarly up in some the state’s other cities such as Tampa and Orlando, which require renters to fork over 45 and 37 percent of their monthly pre-taxed income, respectively.
Miami is now the least affordable place to live in the United States, new real estate data shows
According to Realtor.com , Miami’s median monthly rent – currently $2,930 – now rivaling those in New York and San Francisco, and calls for a whopping 60 percent of a tenant’s typical income – nearly 14 percent higher than that of Los Angeles, the city that thrusts the second-highest burden on renters, with 46 percent and an average rent of $2,993
Housing policy experts commonly contend that rents are no longer considered affordable after surpassing the 30-percent mark.
In contrast, New Yorkers pay an average rent of $2,725 – which calls for 40 percent of a tenant’s income, the report revealed – while the standard in tech-rich San Francisco is $2,970, which just meets the unaffordable mark with 30 percent, the data shows.
The rising Florida rates, experts say, come as rents have also risen drastically throughout the country, with Americans returning in droves to a market that was hopelessly hampered during the pandemic.
But, according to Danielle Hale, chief economist at Realtor.com, migrating tech workers enticed by the state’s lack of income tax and low property taxes have caused Florida’s housing market to blossom at a rate not seen anywhere else.
‘For migrating tech workers leaving San Francisco, New York, Chicago, being able to save thousands of dollars each year remains a compelling driver… to relocate,’ Boyd told CBS News last week of her firm’s report, which looked at rents until February.
The financial benefits for remote workers looking for less-costly digs has seen the state’s population boom since the pandemic, growing by more than 300,000 between 2020 and 2021, state statistics show – a rate faster than any state’s except Texas, which has seen a similar pilgrimage from affluent professionals.
What’s more, a slew of recent high-profile corporate moves to Florida, by companies like Goldman Sachs, Elliott Management, and Virtu Financial, Boyd said, have further bolstered the city’s allure.
Migrating tech workers enticed by the state’s lack of income tax and low property taxes have caused Florida’s housing market to blossom at a rate not seen anywhere else
According to Boyd, the number of inquiries his company gets from firms interested in moving to Miami after allowing more remote work in conjunction with a scaled-back in-person work model has grown exponentially when compared to before the pandemic.
‘Based on what our clients are telling us, that hybrid model is here to stay.’
Real estate data shows that a significant portion of Florida’s rapidly blossoming housing market is comprised of buyers from out of state.
Redfin, a real-estate brokerage, released a report this month showing that record numbers of homebuyers searched for housing outside the city they lived – with Miami serving as users’ most sought-after destination.
According to the firm’s report, 32.3 percent of users were looking to move to a different metropolitan area in the first quarter of 2022, up from 31.5 percent a year ago and 26 percent in 2019.
The company cited factors like skyrocketing home prices, rising mortgage rates and inflation – which hit a 41-year-high 8.5 percent in March – for reasons why families have sought more affordable place to live. They also note that the ability to work remotely has given people more freedom to move.
The analysis also looked on a sample of about two million Redfin users who searched for homes across more than 100 metro areas in the first quarter, singling out what they deemed were serious buyers.
The top cities with resident that were looking to leave, according to the data, were from San Francisco, Los Angeles, and New York – all employment and tech hubs where workers make markedly more than others across the country.
San Francisco, Los Angeles, New York, Washington DC and Seattle topped the list of cities people are looking to move to, with Miami atopping the destinations
Real estate data shows that a significant portion of Florida’s rapidly blossoming housing market is comprised of buyers from out of state
Real estate experts cited factors like skyrocketing home prices, rising mortgage rates and inflation – which hit a 41-year-high 8.5 percent in March (pictured) – for reasons why families have sought more affordable place to live
Notably, three of the top six cities on the list of high inflows were in the state of Florida – with Miami topping the list.
Redfin suggests that ‘sunny, relatively affordable’ areas are often the most popular places to move, but that the searches for Florida’s biggest cities have skyrocketed. Miami’s at six times the number of searches for people to move than it was two years ago, while Tampa’s numbers have tripled since before the pandemic.
‘For deep-pocketed executives, they’re sort of playing with house money because there are still bargains in Palm Beach county and Broward county and Miami-Dade, compared to the prices of the Bay Area,’ Boyd says of the phenomenon.
‘People are outbidding homes in Broward county and Palm Beach county by the millions of dollars. It’s a routine occurrence.’
While Florida is increasingly attractive for outsiders across the country, the recent uptick has left many long-time residents, especially low-paid service industry workers and senior residents, struggling to keep up with the rapidly rising rates.
Those pressures have also been compounded by the city’s current inflation crisis, as well as lingering effects left by the pandemic.