Florida Markets Top New Ranking Of Dramatic Rent Increases

Miami is at the top of a recent list from three academic researchers ranking the largest premiums and annual rent increases nationally, as rent spikes intensify across the Sun Belt and West amid record supply and demand imbalances.

Ken Johnson, Ph.D., of Florida Atlantic University, Shelton Weeks, Ph.D., of Florida Gulf Coast University, and Bennie Waller, Ph.D., of The University of Alabama, use leasing data from Zillow’s Observed Rental Index to determine existing rents and statistically model historical trends from 2014. The Waller, Weeks and Johnson Rental Index covers the entire rental stock of homes and apartments.

The trio found that renters in Miami are paying 21.98 percent above the long-term rental trend and 21.92 percent more than they did a year ago. Cape Coral/Fort Myers, another hot Florida market, came in at #2.

However, the Florida rent increases are showing signs of slowing, according to Weeks, who said most of metro Miami’s 21.92 percent year-over-year increase occurred between September 2021 and February.

“In the last six months, rents in the area are up only 6.80 percent, implying a slowdown in the pace of rent increases,” Weeks said.

The researchers say Hurricane Ian will have a short-term effect on rents as construction slows. Rents may be forced higher, if only temporarily, but the researchers say any blip in demand along the Atlantic and Gulf coasts not directly impacted by the storm will return “relatively quickly.”

“In the long run, people still will want to live in Florida, increasing demand dramatically,” Johnson said.

The ten cities with the greatest year over year change in rents were Miami, Cape Coral, Deltona, Fla., Knoxville, New York, Orlando, El Paso, San Diego, Palm Bay, Fla., and Lakeland, Fla.  The top 10 cities with the biggest rent premium were Miami, Cape Coral, Tampa, Knoxville, New York, Charleston, El Paso, North Port, Orlando, Deltona, and Palm Bay.