After Ian, rent spike in Fort Myers, Cape Coral continues to worsen

Rent is rising in Southwest Florida and will probably stay that way. Fort Myers and Cape Coral rents are exceptionally high, even more than major cities like Tampa and Orlando.

The year-by-year percent change in rent prices is the second highest in the country, and this can be hard for people, especially in the wake of Hurricane Ian.

The rent is high because there is a significant need for housing, and, likely, people who want to come to Southwest Florida decide not to because of the expense.

Rent is also high because many people are in the area to help with our recovery from the hurricane, taking up much-needed inventory.

Whether you’re in Cape Coral or over the bridge in Fort Myers, you can take this to the bank; you’ll see steep rent prices, and it’s only getting worse.

“I’m paying as much for two months over here as I would for three months over in Lexington,” said Mike McLain.

McLain is a snowbird from Ohio who has been coming to Southwest Florida every year since he retired. He was renting a place in Fort Myers, but then the hurricane hit.

“My place I was renting in Fort Myers was first floor. So it got, not destroyed, but it was uninhabitable,” McLain said.

Shelton Weeks is a Lucas Professor of Real Estate at FGCU. He’s been studying the rent trends throughout the country. For months, Cape Coral and Fort Myers showed the highest yearly spike in rent. In February, they fell to number two with a 13.88% increase.

“When you look at this from a developers standpoint, it’s very challenging for them to bring product to the market given our construction cost at anything other than sort of premium rents,” said Weeks.

WINK News asked Weeks if people are getting priced out of Southwest Florida. “I think it’s having an impact on some folks where they’re looking at the cost of housing and particularly on fixed income. It makes it really challenging for them to stay in Southwest Florida.”

Weeks said he hopes the rental situation doesn’t get any worse as there are complexes under construction that will help with the inventory, but the problem is, it takes time for those to be built.

A study by FGCU shows the average rental rate is about $2,270.

“It makes it harder and harder from across our community to find affordable housing. And really, when you think about it, there’s not an easy solution anywhere on the horizon,” said Weeks. “Just the actual construction costs to build things to our code that we need to have safe housing, especially in the face of Hurricane Ian. It’s just the numbers don’t work for us to add anything other than properties where you’re going to be able to charge somewhat higher rents.”

Those higher rents are higher than major cities in Florida, like Tampa and Orlando.

“The number of sites that are appropriately zoned and of the appropriate scale to make this make sense economically is very limited. And that’s what’s making our numbers jump higher than those municipalities,” Weeks said.

That surprised McLain. During his visit to Southwest Florida, he had to rent in Cape Coral this year.

“Next year, I’m anxious about what I’m going to pay because if it’s too much, I’ll try to get two months. But getting two months is hard to do. So do I pay the piper or not?” said McLain.

Weeks said his best advice for those trying to navigate this rental market is to start early and cast a wider net in terms of locations you’re considering.