What’s Affordable for Renters in Florida?
A new report shows renters in South Florida aren’t earning enough to keep pace with expenses, while those in other parts of the state, like Jacksonville, are better off.
MIAMI – How far does Florida renters’ income go toward paying everyday expenses? A new study shows the South Florida region falling short in affordability when compared with other parts of the United States.
Out of nearly 200 cities reviewed, Fort Lauderdale and Miami were among the lowest ranked in how much renters get out of their income: Fort Lauderdale ranked 129th and Miami ranked 159th, according to data from a recent RentCafe report.
RentCafe’s data highlights how renters’ incomes aren’t keeping up with the price to live in the region. Even though rents are gradually plateauing, salaries are floundering, meaning the burden to cover costs is ballooning.
“Renter incomes are relatively low. We have a lot of lower-paying industries,” said Anne Ray, a researcher at the University of Florida’s Shimberg Center for Housing Studies. “Service industries, hospitality, food service, some health care professions, they make up a lot of the jobs in South Florida.
“So the pay is relatively low, yet our rental costs are relatively high and have gotten increasingly expensive in recent years.”
A closer look at renters’ expenses
RentCafe researchers granted scores to 189 cities, which they calculated by assigning points to different categories of spending. These categories included utilities, such as phone and water bills, food, health care, transportation, and goods and services, such as a haircut or buying a new pair of jeans.
The costs for those expenses, factored in with average monthly rent and household income, generated scores for each city. The higher the score, the less renters’ incomes are being stretched, or strained — essentially, the renters in higher-scoring cities are typically less financially stressed.
“There’s other discretionary spending that goes on, but we thought that these were the primary ones that governed the bulk of a person’s budget,” said Doug Ressler, the senior analyst at Yardi Matrix, the data provider behind RentCafe’s studies.
The higher the score, the better. The city with the highest score? Sunnyvale, California, with a 93.83, where costs are high, but incomes are, too — it’s roughly the area of Silicon Valley, after all.
Regions in South Florida were closer toward the end of the list: Miami scored 20.32. Fort Lauderdale’s score is only slightly better at 26.58.
Scores varied across the state, with Jacksonville being the best at 42.14, ranked No. 45 out of the 189 cities, the result of slightly lower average monthly rent, slightly higher incomes and less money allocated to transportation expenses. Cape Coral had a similar score, at 39.52, ranked No. 54, and while average rent is high, average income is higher there than in most Florida cities.
And in Orlando and Tampa, where scores were about 36 and 35, and ranks 84 and 89, respectively, average rents hover around $1,900 with average incomes being hardly more than $55,000.
“The purpose of the indices that we had was meant to take and roll into account all the factors of cost of living, income and rent, health care, transportation, and then roll it up to an index, weighted of course, that would be a comparator to other markets,” Ressler said. “We did not select one of the variables, we combined all of them.”
Housing and transportation are the income-draining culprits that should be looked at the most, Anne Ray said, especially in comparison to less-offensive factors such as individual grocery items.
“If you’re thinking about what’s different from one place to another, a gallon of milk is more or less a gallon of milk,” she said. “If you live in an area with little public transit availability, if you’re forced to live far from your job in order to find an affordable place to live, then your transportation costs are going to go up a lot.”
“You’re paying for a car, you’re paying for insurance, you’re paying for gas or you’re paying for the maintenance on a car, and if you have to drive far, all those costs are going to go up.”
Minimum-wage workers would likely struggle in any of the communities where income stretches, Ray said.
“It’s not because those places are more affordable. It’s because some of the renters are wealthier,” she said.
Key takeaways
The data points to a few trends, Ray said, including:
The presence of older people may also help explain why cities such as Gainesville and Ocala have such low scores, at 9.59 and 19.29, respectively.
As a college town, Gainesville is rife with student housing, which dissipates its number, Ressler said. Instead of one family per unit, hordes of students are generally living in most available apartment units, so the price is “disseminated over a larger population.”
As for Ocala, it’s north of The Villages which is, as Ressler put it, “boomer heaven.”
This concept actually plays into the statewide issue of high rents because the presence of “boomers” indicates people are less transitory than they were in the past, Ressler said.
“It used to be that you would see employment diasporas occur after a year or so, jobs filtered away on the west side, on the gulf side, and everybody kind of took that as a paradigm, but it’s changing,” he said. “People are staying, they’re more sedate, they’re staying longer.”
He added: “Once they come, they stick.”
This phenomenon drives up the demand for housing, but just like income, supply strains to keep up. If supply and demand stabilize, then the renters benefit, he said.
“You might see rents go down once the economic supply and demand get into balance, but the income for food and utilities tends to grow because you have a larger infrastructure,” he said.
Expenses may not be tanking nor salaries soaring in South Florida any time soon, but rents are slowly tapering off — a small but still visible silver lining.
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