FORT MYERS, Fla.- When you can’t afford to own a home, you probably rent. But what if even rent is out of reach? Some of the steepest spikes in the U.S. are impacting renters in Southwest Florida.
Nearly 1 in 3 renters in Florida are struggling to make ends meet with half of every paycheck going straight to their rent and power bill, according to a survey by the nonprofit Make Room.
The rising cost of rent is forcing some families, like Jessica Powell’s to make tough choices.
Powell is a hairdresser, whose salary is based partly on commission. Shortly after her divorce, Powell decided to move in with a close friend. The two single moms have three sons between the two of them.
“When you’re looking at paying over half your income, what about my electric, what about groceries, everything else. What if something happens?” Powell said.
According to real estate company Rent Range, rent in Fort Myers has risen 23.6% in the last year, more than anywhere else in the country.
For small-scale multi-family rentals like duplexes in Lee County, MLS data shows rent has increased almost 11.98 percent in the last year.
ALN, which tracks rental prices throughout the U.S., says rent for apartment complexes with 100 units or more is up 14.1 percent in Fort Myers.
It’s been close to a decade since an apartment community was built in Lee County. Several are going up right now.
“As the demand went up, and the supply stayed constant, rents went up. That got to the point where it made sense for developers to take the risks to build a new apartment community,” commercial real estate broker Gary Tasman, of Cushman & Wakefield Commercial Property Southwest Florida, said.
Apartment specialist Jonathan Richards of CRE Consultants says the increase in rent is a sign of the market catching up.
“Rates have been so low for so long, so we’re starting to see the market normalize,” Richards said.
So what’s at play?
Richards says the Southwest Florida housing crisis has made a lot of people too afraid to buy again. He also says
downsizing baby boomers, mellennials marrying later, debt, and the flexibility to move with job opportunities has occupancy close to 98% in Lee County.
“Lee County is growing which is a really good problem to have. we have have new people that want to rent and buy, so we need to meet those demands somehow,” property appraiser Bill Cole said.
Lee County permit requests for the last four months show more than 400 apartments going in at U.S. 41 and Metro Parkway, and 280 going in at Estero and Three Oaks Parkways.
Development there comes at a time when the Bonita/Estero market is seeing the most expensive rent in all of Southwest Florida. The average there is more than $1,200 a month, a 15% increase in the last year.
“I think as bad as you hear people complaining about $1,200 rent, look in Tampa, look in Orlando. We’re still a great bargain compared to those other communities,” Tasman said.
Bottom line, experts argue Southwest Florida is affordable, because the median household income in lee county is $50,000.
“Rents are $1,100 a month for a 2 bedroom. Most communities require three times that much for gross salary, which puts you just under $40,000, so we’re still pretty far away from the median income,” Richards said.
According to Richards, 2,000 units are either in the planning phase, under construction, or are already being leased in Lee County.
He says the rental market isn’t slowing down, and rents will continue to rise.