In Orlando and many cities around the country, rent prices have begun to fall from the historic highs of the past two years, but Florida’s rates remain persistently out of reach for most workers, according to a new report.
Of the top 100 metro areas in the U.S., 70 had average rent prices decrease from September to October, most by less than 1%, according to a monthly report co-authored by Florida Atlantic University. Springfield, Mass., had the largest drop with 2.38%.
“It’s marginal in most cases, but that’s a really good sign,” said Ken H. Johnson, a real estate economist at FAU. “It’s a momentum.”
Orlando’s average rent for new leases fell by 0.23%, or about $50, to $2,045 per month, the report found. Only four of Florida’s nine largest markets saw drops: Orlando, Tampa (0.32%), Lakeland (0.41%) and Deltona (0.57%).
In this survey, metro Orlando included Orange, Osceola, Lake and Seminole counties.
Orlando’s rent is at a record high. A new survey from analysts Construction Coverage found Orlando had the eighth highest increase in rents nationally since the start of the pandemic, rising 35.8% in two years.
“It’s safe to say we’re not going to see 2020 rents again in Orlando,” Johnson said.
State Rep. Anna Eskamani, D-Orlando, says prices stabilizing around their current heights won’t stem the tide of her constituents looking for rental assistance.
“Every day, I got calls and emails that are focused on the cost of housing, people’s rents going up at lease renewal,” Eskamani said. “The current rates are not sustainable.”
The median household income in Orlando is $55,183, according to the Census Bureau. A rent of $2,045 per month would be 44% of that income. The Department of Housing and Urban Development considers people cost-burdened if they pay more than a third of their income in housing and utilities.
Johnson says the persistent strength of Florida’s rents comes down to continued demand from people moving into the state. Orlando alone is expected to add 1,500 people every week until 2030, according to a report from the Orlando Economic Partnership.
Johnson said the slight decreases in rents is due to a national increase of supply.
“We’re building more,” he said.
In Orlando, apartment vacancy is at 7%, up 1.5 percentage points from a year ago, according to real estate analysts CoStar Group. This year saw 7,650 new apartments open for business, with another 22,426 under construction.
Eskamani said new apartments are helpful, but many are still too expensive.
“We need housing that isn’t luxury,” she said. “We need to ensure we’re also building diverse housing options.”
She also would like to expand government voucher programs for people waiting to get into apartments now.
“Building doesn’t happen overnight,” she said. “The waitlists even for the elderly are years long.”
Johnson’s report also tracks what it calls the premium on rents, the amount being charged above what historical data, population and other factors suggest it should be.
In Orlando, renters pay 11.13% more than they should, according to Johnson.