TAMPA, Fla. (WFLA) — After receiving an endorsement for his reelection race for Governor of Florida, Ron DeSantis took questions about how the state was doing. As the state’s housing markets continue to surge upward in price, and more Americans move to Florida from out of state, the cost of living has become a frequent issue for discussion.
Housing costs in Florida are rising faster than the national inflation rate, and the even higher inflation rate in the state of Florida. Across the board, from rent to mortgages to the price of simply buying a house with cash, prices on average are up between 30-45% in some areas of Florida, depending on if you’re renting or buying, and what city you’re in.
According to Bureau of Labor Statistics data, the national inflation rate at the end of December 2021 was 7%. In the Southeast Region, which includes Florida, the rate was 7.4%.
For Florida’s markets, the rate was 7.1% in the Miami-Fort Lauderdale-West Palm Beach metro area, and 8% in Tampa as of the latest dataset from November 2021. In December, Orlando was 7.2% according to BLS, as was Jacksonville.
The governor said the inflation currently “whacking families” across the U.S. was solely due to poor federal policies.
“We’re really fighting against some difficult headwinds, you know it’s not 6 or 7%. It is way more than that, if you look at different things, like how much it costs for gas, how much some of the core food items have gone up, you look at materials for homes, for anything, but homes,” DeSantis said. “I had to go back, our budget for last year that I signed, we funded a lot of big projects, we’ve had to go back into this budget and put in huge amounts of money for the same projects because the cost has gone up so much.”
Inflation is an issue he laid on the feet of the federal government and President Joe Biden’s policies, blaming agenda items like the recently passed Bipartisan Infrastructure Law’s and further planned “trillions” of dollars in spending proposed by Biden’s Build Back Better policies.
However, when it comes to rising housing costs, DeSantis said it was due to people’s desire to come to Florida being real, not overblown.
“So part of this, I think, is just the fact that there’s strong demand to live in the state of Florida. And most Floridians? The number one asset they have is their home. So we have a lot of elderly people, who’ve paid off their homes, and have been in there, and then they now have an asset that is worth a lot more than it was just a couple of years ago,” DeSantis said. “I don’t think that’s being driven by speculation, like it was in 2007, 8, 9, you know the whole market crash. I think there’s just authentic demand to be able to live in Florida.”
Whether or not the prices are being driven up by authentic market pressures or inflationary factors, a housing price index created and managed by Florida Atlantic University and Florida International University reported the costs of housing across the U.S. are vastly different than the value of the homes for sale.
The FAU and FIU professors who run the market ranking said the study is used to measure the country’s top 100 overvalued housing markets.
Of the top 100 housing markets in the U.S., Florida cities take five slots in the top 25. The two Florida metro areas with the biggest gap between expected price and average list price are Lakeland and Tampa, where homes are a minimum of 40% higher than their expected price.
The Beracha and Johnson Housing Market Ranking reported that as of Dec. 31, 2021, home prices in Lakeland were 42.54% higher than they should be. While a home would be expected to sell for about $190,700, instead the homes are selling for about $271,800 on average.
In the Tampa metro, the premium rate is slightly lower than in Lakeland, but prices are even higher.
End-of-year average home prices were measured at about $327,600, but their expected price was only about $231,600. That’s a 41.46% mark-up. In both metro areas from Tampa Bay, the premium increases rose compared to the month before, according to the Beracha and Johnson Housing Market Ranking.
In the nine Florida cities shown in the ranking system, the metro with the smallest gap between expected price and average selling price was one of Florida’s most expensive areas, Miami. Home price listings were averaging just under $400,000 while the expected prices were about $327,400.
The most expensive area listed on the ranking system in Florida was the Sarasota metro area, where homes were over $400,000 on average, but their expected prices were just over $300,000, a 34.5% gap, according to the price analysis.
Months of constant rent increases in the Tampa Bay area, Florida and the United States have continued to push the cost of living up. It’s caused affordable housing to frequently become a campaign platform for local politicians, such as the St. Petersburg City Council, the Hillsborough County Commission, members of the U.S. House of Representatives, and the Tampa City Council, as well as newly elected St. Pete Mayor Ken Welch.
Emergency rental assistance programs across the state and country are limited, with funding coming but applications never truly guaranteed to help those requesting aid. The set up for each program and how local municipalities manage it also means funding can run out, putting long-term solutions further out of reach. In the meantime, the number of evictions has started to rise in Tampa.