- Despite national trends of declining rent growth and tenant-friendly shifts, Florida’s rental market faces challenges in cooling off.
- Approximately 825,990 low-income households in Florida spend over 40 percent of their income on rent, despite the addition of rental units. The state lost affordable units while adding more units with higher rents.
- Miami-Dade County is at the center of Florida’s affordable housing crisis, with the highest number of cost-burdened renters. The state as a whole experienced population growth, exacerbating the affordable housing challenge.
Recent data suggest that Florida’s rental market faces challenges in cooling off, despite a broader national trend of declining rent growth and a shift in favor of tenants.
Researchers at the University of Florida’s (UF) Shimberg Center for Housing Studies analyzed data on Florida’s affordable rental housing needs, finding that approximately 825,990 low-income households in Florida are burdened with paying more than 40 percent of their income towards rent.
While the state witnessed the addition of hundreds of thousands of rental units between 2012 and 2021, it simultaneously lost units renting for $1,000 or less. Conversely, nearly 600,000 units with rents above $1,000 were added during the same period, exacerbating the challenge of affordable housing.
“A slight cooldown would stop things from getting worse for renters looking for an affordable unit in Florida, but it can’t make up for double-digit percentage rent increases that already took place the last couple years,” Florida Housing Data Clearinghouse manager Anne Ray said. “This means the rental market is stabilizing at a really high rate.”
Researchers also found that more than one-third of low-income renter households struggling with high prices are headed by people 55 years of age or older. It was also noted that the majority of non-working renter households are made up of senior citizens or people with disabilities, further compounding the rental market’s complexities.
In terms of regional analysis, Miami-Dade County emerged as the epicenter of Florida’s affordable housing crisis, with the largest number of cost-burdened renters in 2021. Real estate data collected between 2020 and 2022 found that all 67 counties in the state experienced household growth during the observed period, with Miami-Dade County leading the way with the addition of 24,040 households. In total, the state registered 309,594 new households during the timeframe.
“Tenants have a lot of ground to make up after years of hot rental markets in Florida,” Ray said. “Affordable housing will continue to be a challenge for quite a while.”
According to a March 2023 survey conducted by the Public Opinion Research Lab at the University of North Florida, 25 percent of respondents listed housing costs as the biggest problem currently faced by Florida. The issue outpaced other concerns like the economy (17 percent), education (12 percent), and immigration (10 percent).
Amid proliferating concerns surrounding the rise in housing costs, lawmakers took legislative action earlier this year to address affordable housing scarcities. The Live Local Act, introduced by Sen. Alexis Calatayud, intends to provide incentives for private developers to construct affordable housing units for low-to-moderate-income workers in the area where they work. The legislation served as a top priority for Senate President Kathleen Passidomo and received bipartisan support.
The legislation additionally pre-empts local-government rules on zoning, density, and building heights in certain circumstances and creates tax exemptions for developments that set aside at least 70 units for affordable housing, speed permits, and development orders for affordable housing projects.
“Floridians are ready to [Live Local] and to spend less time commuting and more time raising their families in the heart of the communities they serve,” said Passidomo upon the bill’s House passage.
The bill appropriates a total of $252 million to the State Housing Initiatives Partnership (SHIP) program and $259 million, including $150 million in new recurring funds, to the State Apartment Incentive Loan (SAIL) program.
The SAIL Program provides low-interest loans on a competitive basis to multifamily affordable housing developers, and the bill directs the additional funds to be used for projects focusing on mixed-use development, urban infill, or developments near military installations in Florida.
The measure also incentivizes the construction of new projects near existing workforce housing units to be built via the restoration and refurbishing of older rental units.