South Floridians bear the heaviest burden when it comes to rent in comparison to the rest of the country. According to a report from the Harvard Joint Center for Housing Studies, 62 percent of the tri-county renters pay a minimum of 30 percent on their income on housing costs alone, while thirty-five percent shell out at least half of their gross income on rent. In the nation’s 100 largest metro areas, these two percentages are the highest.
Analysts advise monthly housing costs should not be more than 30 percent of the consumer’s salaries. However, this is significantly difficult in South Florida due to flat wages and the ever increasing competition for rentals. This is mostly common among young professionals and former homeowners. To make matters worse, builders are making up for lost time from years of almost no apartment construction to luxury apartments popping up like daisies that are largely unaffordable to lower and middle classes.
The newly opened Mark at Cityscape in Boca Raton are renting for more than $3,000 a month, while a 700 square foot studio in Fort Lauderdale at Manor at Flagler Village is around $1,750 a month. The Reinhold P. Wolff Economic Research in Oakland Park states that in Broward County the monthly rent went up around 8 percent from last year, averaging out to $1,553 a month. Rents in Palm Beach County rose 6 percent from a year earlier making them about $1,520. Miami-Dade County’s average rent is $1,609, 5 percent higher than last year.
The U.S. Census Bureau data show the average household income in South Florida is about $48,458 last year, which is $5,199 less than the U.S. figure of $53,657. In the largest metro areas surveyed by the Census Bureau, only Tampa had a lower median household income than South Florida. Daren Blomquist, a vice president of RealtyTrac, a foreclosure listing firm in Irvine, Calif., said he sees little relief in sight. While rent increases will level off, he said, builders will continue to push for luxury communities because those deliver the greatest profit margins. Consumers who purchase homes will have less expensive monthly payments than those who rent, however they face the problem of coming up with a down payments which is harder to do with the increases in rent.
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