Just as we suspected, it looks like all of those out-of-state license plates really are paying a premium for congesting I-95.
A recent study from Florida Atlantic University reveals that surging home prices around the country pale in comparison to the rates being paid in Florida, with the top five overvalued real estate markets in the country right here in the Sunshine State.
Number one on the list is the area in and around Miami/Fort Lauderdale (who would’ve guessed?), which includes Broward and Palm Beach. Renters pay, on average, $2,832 for a rental that should cost $2,325.99. That’s a 21.75% premium to live in Miami, which presumably doesn’t include a daily dose of aspirin for all the headaches that come with it.
Florida areas make up 10 of the top 25 overvalued markets, with Melbourne, Orlando, Jacksonville, Daytona Beach, Lakeland, Port St. Lucie, North Port/Sarasota/Bradenton, Tampa and Fort Myers receiving (dis)honorable mentions.
The study found that rents increased dramatically during the pandemic as out-of-state transplants flooded the state, presumably to enjoy life with less intense COVID restrictions (here’s looking at you, New York). The study also notes that rent increases are unusual, as the rental market is much less volatile than the housing market, which is more reactive to external factors like mortgage rate changes. And if you’re thinking, “Wow, city life sure is expensive, maybe I’ll live in the suburbs and commute to work,” now isn’t a good time to be staring down the barrel of a gas pump, either.
The outlook is admittedly grim.
“We want an immediate solution to this problem, but there is none,” says FAU College of Business Economist Dr. Ken. H. Johnson. “There is going to be a reckoning from this latest housing crisis.”
It’s going to take time for the housing supply to meet the housing demand, with developers facing supply-chain shortages and a rising cost for materials, but there are ways to combat the rising cost of living. Trying to negotiate a longer lease with your landlord can help put off rent increases, moving to a less popular area of town can cut rent payments, and refinancing your mortgage can help lower monthly payments that are increasing due to higher property taxes.
While many are facing difficult decisions in the face of rising housing and rental costs, for the time being it seems that’s going to be the price of admission for endless summer in the Sunshine State.
