The Sunshine State has seen a tremendous amount of increase in the rental market over the past few years. Between 2020 to 2022 alone, rental prices rose 36%, according to Florida Tax Watch. While the rate of rental price increase has slowed, rentals in the state are still in demand.
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If you’re drawn to the allure of Florida’s beaches and temperate climate but not in a position to buy a home, renting is always an option. However, that might not be so easy, according to Rentdata.org, which states that Florida has the 18th highest rent in the country (out of 56 states and territories). Finding affordable rent may be a challenge, depending upon your income.
The rate of rental increases seems to be slowing, but not stopping. Some forecasts are suggesting that demand for rentals is slowing, and supply is increasing, which may drop prices the further into 2023, but at the moment, prices are still fairly high.
A general rule about rent is that it should not exceed more than 30% of your household income. If rent runs more than that, a household is considered “cost burdened.”
According to Florida Tax Watch, lower earning Floridians are at risk of being cost burdened when it comes to increasing rental costs. With the average median income for Florida households sitting at $61,777.13, most households in that lower earning wage group are using about 40% or more of their income for rent, meaning they are cost burdened.
To determine whether you can afford rent in Florida, GoBankingRates researched key data on the cost of rent in different parts of the state and the earnings required to pay for it.
Variations in Rental Markets
The fair market rent in Florida is $1,134 for a two-bedroom apartment in the Gainesville Metro area. A studio or efficiency is $854 per month, and a house or an apartment with 4 bedrooms is $1,523 per month, according to RentData.org.
In big metro areas, these prices can be significantly higher. The following comes from ApartmentList:
- Miami’s prices have increased 8.7% from 2022. The median price of a one-bedroom apartment in Miami is $1,622, while a two-bedroom apartment is $2,150.
- In Ft. Lauderdale, prices increased by 3.7% from the same time last year. The one-bedroom median price is $1,609, and two-bedrooms are $1,962.
- In Tampa, rent prices rose 2.1% year-over-year. The median rent price for a one-bedroom unit is $1,427, and two-bedrooms are $1,806.
- Orlando’s rent prices rose 3.8% year-over-year. Currently, the median rent price for a one-bedroom apartment is $1,404 while two-bedrooms are $1,733.
While it’s impossible to predict exactly what rental prices will do, many people hope for a cooling of the rental market. Especially given the fact that approximately 15% of Florida’s population qualifies for housing assistance (or around 40,216 people), according to RentData.org.
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What You Need To Earn
According to The National Low Income Housing Coalition (NLIHC) as of their 2022 “Out of Reach” report, the 2022 national housing wage was $25.82 per hour for a “modest” two-bedroom rental home and $21.25 per hour for a one-bedroom rental home.
With the Federal minimum wage being $7.25 per hour, and the state minimum wage at $11/per hour (to increase to $12 in September 2023), the average Florida worker is put in a tough position. To afford rent, employees may have to work multiple jobs or find someone to share the costs.
According to the NLIHC, even for workers who earn the higher state or county minimum wage in Florida, the average minimum-wage worker would have to put in 96 hours per week (or two and a half jobs worth of hours) to afford a two-bedroom rental, and 79 hours to afford a one-bedroom at the current fair market rate.
Rental Assistance
For people who can’t afford the rent in Florida but need to live there, they can turn to the U.S. Department of Housing and Urban Development (HUD) for resources, such as public housing agencies, an eviction prevention toolkit, Federal tax credit housing assistance, and other resources that can either offset the costs of rent or find low-income housing opportunities.
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This article originally appeared on GOBankingRates.com: Can I Afford Rent in Florida?
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
