South Florida’s rental markets sizzled in 2023, ranking among the nation’s hottest, with Miami-Dade claiming the top spot and Broward securing the 7th position, according to RentCafe’s recent data. However, there’s a glimmer of hope for renters and buyers in 2024.
RentCafe determines the “competitiveness score” based on factors like average vacant days, occupancy rate, prospective renters, and lease renewal rate. Melissa Hoff, a broker associate with Compass, explained competitiveness as the scenario where more people are eyeing a unit than there are available, attributing it to ongoing demand outpacing supply.
Despite the robust market, some factors may tilt the scales favorably for renters and buyers this year. Election years often correlate with lower interest rates, a trend Hoff anticipates will continue, making it an opportune time for prospective buyers to enter the market. She expects rate drops to incentivize current renters to transition into homeownership, noting a pent-up demand ready to make a move.
While South Florida grapples with limited inventory, Hoff believes that as interest rates decline, inventory will expand, offering more choices for those seeking properties locally or migrating from other regions.
Ken H. Johnson, a real estate economist at Florida Atlantic University, shares the optimism, predicting that people will have more options this year. Although rent and home costs remain high, Johnson’s analysis through FAU’s Rental Index indicates a stable projection, signaling a potential easing of the market.
One challenge to meeting demand is the short-term rental market, which continues to absorb units. However, both Johnson and Hoff concur that 2024 holds positive prospects for renters and homebuyers. The gradual cooling of the rental market might lead to fairer terms between landlords and tenants, providing increased opportunities for those seeking new living arrangements.
In essence, South Florida’s housing market is expected to offer a better landscape for homeownership and renting in 2024, marking a positive shift from the previous year.
