The Miami Rental Market is HOT!
I don’t know what’s happening in the Miami Rental Market, but I can tell you that rentals are flying off the MLS like hot doughnuts at Krispy Kreme!
If you look at real estate market trends this is a really positive thing. Historically, when there is more demand than supply of rentals, (rental vacancies go down), it’s a sure sign that the real estate market is beginning to stabilize.
This is not just in the United States, this is the law of supply and demand – I picked an Australian Article that demonstrates the property cycle beautifully.
“The first sign of this change is in the rental market. The vacancy rate – that is, the proportion of vacant rental properties in the market – will fall and as a result rents will rise. With rising rents, investors are normally the first to be attracted back into the market.
As investors re-enter the market after a downturn, prices will start to push up again slowly. Home buyers see values rising and want to ‘get in on the ground floor’ of the next boom or, in the case of the first home buyer, before prices go beyond their reach. “
Does that mean that the Miami Real Estate Market is beginning to correct itself? Looking at history, this is a great sign….but don’t expect a drastic change over night.
The rental market in Miami is on fire. That does not mean the rent rates are going up, it means that there is a flood of Premium rentals as they are individually owned condos just closed on and the owners want to mitigate expense of carrying costs so they rent. Additionally a few other factors make South Florida good rental market.
1. Florida is a transient state. Always has been, always will be.
2. Forclosures are at an all time high. People still need a roof over their heads. They move out of homes they cant afford and rent something else.
I hope this helps
Michael
Michael – thanks for the feedback but things have definitely changed since August 2007 when this article was written. We deal with 2 types of rentals now – single-family homes and condos.
You are right about the large nuber of new condos available where owners want to cover expenses and thus rental rates have competition.
On the other hand, the single-family rental market remains just as HOT or even HOTER than a year ago – they fly off the market, and get good money since the inventory stays low.
We also see a lot of people in foreclosure that try to rent and can’t qualify when a credit report is pulled because of their foreclosure history.
It’s not easy, but the changes in the rental market are a sure sign of what’s to come.