Sally Starkey thought it would be easy to move from Chicago to Florida. The 33-year-old publicist was moving to Naples, Florida when her husband got a job nearby. The couple was familiar with the area from friends and family who were vacationing there, and the couple were excited to move, she said.
“We thought we would have no problem finding a place to live,” Starkey said.
She was wrong. The couple inquired into two dozen apartments before agreeing to rent a townhouse in northern Naples – invisible sight. “It took us up to two weeks before we were out of our apartment in Chicago,” Starkey said.
At $ 3,500, meanwhile, the rent on their two-bedroom, two-bathroom townhome is about 20% more than what they paid in Chicago, though she considers herself lucky given the alternatives. “I’m telling you we were lucky,” she said.
The couple’s experience encapsulates several key housing trends that combine to make it harder – and more expensive – for Americans to put a roof over their heads. Most importantly, rents and housing prices are rising at the fastest rate in years, increasing the financial burden on millions of working-class and middle-class households who are already struggling to afford a place to live. A shocking bout of inflation, following the economic downturn caused by the pandemic, increases this pressure.
Rents, which arenationwide flies positively over Florida, driven by a wave of people who moved to the state during the pandemic. Florida’s population is growing faster than any other state except Texas: Between 2020 and 2021, 300,000 people moved to Sunshine State.
In February, Realtor.com named Miami the least affordable place to live in the United States. The average monthly rent in the metro area, at $ 2,930, is on a par with San Francisco and Los Angeles – and double the level considered affordable for people in the region given the local median income. Miami, Orlando and Tampa have the fastest growing rents in the country over the past year.
“These Sun Belt markets, and Florida in particular, have topped our lists in the last few months,” said Danielle Hale, chief economist at Realtor.com.
Florida’s housing problems have been going on for years, with the state benefiting from robust population growth, while also courting new residents and businesses that are attracted to the low taxes and an anti-regulatory agenda.
Politicians in Florida have sought to diversify the tourism-heavy economy with new jobs in banking, technology, life sciences and logistics, said John Boyd, principal of Boyd Co., a site selection firm in Boca Raton, Florida. For individuals, lack of personal income tax and relatively low property taxes are combined with sunny weather to make the state an attractive destination for high-paying professionals.
“For migrant technology workers leaving San Francisco, New York, Chicago, it’s still a compelling drive to be able to save thousands of dollars every year … moving,” Boyd said.
A number of recent high-profile corporate relocations to Florida, including Goldman Sachs, Elliott Management and Virtu Financial, have boosted Florida’s profile, while the pandemic’s shift to telework put turbocharged relocations, Boyd said. The level of inquiries his company receives from companies interested in moving to the state has increased tenfold compared to before the pandemic.
“Based on what our customers tell us, that hybrid model is here to stay.”
Good job if you can get it
Data from Realtor.com shows that a large portion of the demand for housing in Florida comes from overseas. One-fifth of Miami real estate searches originate in the New York City area; a further 8% from Washington, DC Washington and New York account for 15% of the demand for Tampa housing.
In fact, prices that are historically high by Florida standards may not deter anyone from fleeing even more expensive New York or the Bay Area, Boyd said.
“For deep-pocket executives, they’re kind of playing with house money because there’s still great deals in Palm Beach county and Broward county and Miami-Dade compared to the prices in the Bay Area,” Boyd noted. “People outbid homes in Broward county and Palm Beach county by millions of dollars. It’s a routine incident.”
Jacqueline Fisch, a 41-year-old PR employee, was able to play the pandemic escape to the suburbs to her advantage when she moved from central New Jersey to Tampa last year.
Fisch had moved to New Jersey in 2020 to be near her husband’s Manhattan job, but that summer they both worked remotely and their two children went to school from home. On a Christmas vacation in Florida, the family received a revelation.
“On day three, it was 75 degree weather and we said, ‘Wait, we can stay here,'” Fisch said. They started planning their move on the plane back.
In January, the family home in New Jersey was under contract for $ 200,000 compared to what they had paid for it. They put the profits into a property still under construction in northern Tampa, which cost about $ 450,000, moved to buy the house with only the foundation poured, and knocked out three other potential bidders. They moved in in September.
“Our mortgage payment went from $ 4,000 to $ 1,500,” Fisch told CBS MoneyWatch. “The only thing that’s more expensive here is car insurance.”
She said she does not love traffic, but appreciates everything else: “The beaches, the bay, kayaking – being able to be outside, being comfortable outside, almost all the time.”
“I’ll leave as soon as I can”
Although Florida is increasingly attractive as a place to live for many Americans, the influx is pushing many permanent residents, especially low-paid service industry workers and elderly residents with fixed incomes. The state explicitly prohibits rent control, which can put a ceiling on sky-high rents.
Michele DeMoske-Weiss, a retired nurse living on a fixed income, is ready to go on bail after 30 years of living off and on in the state.
“For the first 15 years, it’s amazing, it feels like you’re on vacation, and then for the other 15 years, it’s miserable,” she said of living in Florida.
DeMoske-Weiss, 70, recently reduced when her landlord wanted to raise the rent on her Lake Park two-bedroom to $ 2,400 a month. She moved to a one-bedroom apartment on a lower floor to keep her rent at a manageable $ 2,200. She is now considering moving to the state of Washington or Pennsylvania to be close to her children.
“I’m leaving as soon as I can get out,” she said.
For others, including workers in the state’s low-wage tourism sector, it’s harder to leave. Many working-class families in South Florida have protested against rent increases, which they say could put them on the streets.
“It feels like a greedy, greedy time,” said Mike Wootan, whose rent on his Miami apartment is rising by nearly $ 500 a month to $ 3.00 in June. Wootan, 29, runs a cannabis business. In the year he has lived there with his girlfriend, Wootan has not been able to use his balcony or pool on the complex due to renovations, and the increase feels like “adding spot to damage,” he told CBS MoneyWatch . “I’ve been thinking about it almost daily.”
Still, Wootan and his girlfriend decided to live with the increase rather than spend money on a move, which would also cost them working days. He has thought more about buying a home, but said it is financially out of reach.
“I’m getting to where I’m really tired of renting and it does not feel like a good time [to buy]he said. “It feels like we’re on the verge of another bubble that will burst.”
Even when the housing sector returns, the nation faces a deficit of 1.3 million homes given the decline in construction activity during the pandemic. This deficit, combined with investment firms competing with families for start-up housing, means it could take years before market forces allow incomes and rents to adjust.
Meanwhile, as both rent and home value grow at staggering rates, it makes it so much harder for renters to even consider buying a home.
“It’s a challenge in today’s market because we have such a limited housing supply, whether we’re talking about homes for sale or rental homes, and the higher prices make it difficult to switch to owning,” says Hale from Realtor.com.