TAMPA, Fla. (WFLA) — Rental update after rental update showed the rising prices of rent in Florida have finally started to slow down their climb, but the prices themselves have not started to fall.
A new data report on rental fluctuations from Zumper showed cities in the Tampa Bay area have started to drop their rankings in fastest rent growth, but the prices remain high.
Analysis by Florida Taxwatch, a nonpartisan research group based in Tallahassee, reported Florida’s strong economy during the pandemic could leave lower-income families behind as housing costs become one of, if not the most, the “biggest concerns” of the pandemic, “second-highest only to contracting COVID.”
According to Florida Taxwatch, the pricing may cut into the state’s high migration rate. While the state legislature is currently estimating about 850 people will move to Florida every day through 2026, Florida Taxwatch said the high costs could push people out instead.
“Especially for young professionals, being priced out of certain markets may lead to outbound migration from the state over time,” Florida Taxwatch said. “And since the pandemic has shown that where one works and where one lives can be different, this may further incentivize movement to more affordable regions in the U.S.”
The data from Zumper’s rent report showed Florida’s rental costs are among the highest in the nation. That said, cities in the Tampa Bay area have started to drop lower on the list, in terms of price increases. While Miami remains in the top five most expensive places to live, Fort Lauderdale, Orlando, and Tampa all dropped at least one ranking for cost increases. Tampa itself is the 25th most expensive city to rent in across the U.S., according to Zumper, down from No. 23.
St. Petersburg dropped one rank, down to No. 30 from No. 29, but showing no change in rent price over the past month.
Of the national top 50 high-rent cities, Jacksonville is the last spot in Florida, at No. 48, though its rank actually increased six spots in Zumper’s listing, with a reported 5.1% increase in rent prices month-to-month, with the average price at $1,230 for a one-bedroom apartment.
“Affordability is a core concern when it comes to rapid rent growth, impacting working families and local businesses,” Florida Taxwatch said. “According to the United Way, there were more than 3.6 million households in Florida that were Asset Limited, Income Constrained, Employed (ALICE) when COVID-19 hit.”
The organization said ALICE homes are the households were those that have incomes above the federal poverty level but not enough money each month to cover things like housing, child care or transportation. Due to ongoing inflation, which remains at a 40-year high, with a third of the increases owed to rising fuel and housing costs, the affordability gap has grown.
Zumper’s market data showed that rent growth in 2022 is already “outpacing 2021.”
While the previous year “experienced the most rent growth of any year in a generation,” and wages did increase overall according to reporting by the U.S. Bureau of Labor Statistics, the gap between earnings and affordability did not close, particularly because of months of rising inflation cutting into the impact of increased wages.
Florida’s wages increased 8.7%, collectively, making the state the third highest for wage growth in the U.S.
Still, BLS reported that on average, Americans are earning $11.11 per hour in real hourly earnings, compared to $11.41 the year before. For workers, that means how much they’re taking home after taxes and inflation’s costs, workers are earning $0.30 less per hour. With everyone taking home less despite wage gains, affordability is a bigger issue with rising costs.
It’s an issue Florida Taxwatch flagged for Florida workers and rising housing costs.
“Even with wages growing across industries, many occupations may not be able to afford the rapid rise in rental prices,” Florida Taxwatch said.
They also placed the pandemic at the center of home price increases, but makes clear the issue was exacerbated by COVID-19, not caused by it.
“Florida currently struggles with a lack of affordable housing, which disproportionately impacts vulnerable populations, such as the poor, children, elderly, and persons with disabilities,” Florida Taxwatch said. “Florida’s affordable housing situation predates the pandemic, but COVID-19 has certainly amplified the issue and future consequences. Many low-income families were disproportionately affected by the pandemic, often facing the brunt of unemployment challenges and experiencing housing insecurity.”
The organization also said the price increases were historically high, and the demand compared to low supply of available homes was adding to a need for long-term solutions for the housing market’s shortages. Florida Taxwatch said the state has “often relied on its temperate climate, low tax environment, and natural amenities to attract would-be residents,” but the same factors will be less of a motivator if housing affordability remains problematic, putting future economic growth at risk.