Floridians are spending more than the recommended 30 percent of their income on housing. In South Florida and Orlando, housing affordability for low- and moderate-income workers is a bigger issue than ever, writes Amy Martinez, Associate Editor at Florida Trend. According to the report, the top reasons for the shortage of workforce housing, an issue faced by several communities in Florida, are as follows:
With the state adding about 335,000 people every year, the rate at which the population of Florida has grown resulted in a higher demand for housing of all types. The population is expected to grow further at 6.5 percent to 21.5 million in 2020.
Rising Interest Rates
Rising interest rates have further increased the monthly costs of purchasing a home. Low- and moderate-income workers are especially affected by the rise in interests and remain cost-burdened. According to the Florida Policy Institute, 36 percent of Florida households are paying more than 30 percent of their incomes for housing, including mortgage or rent, utilities, taxes, insurance, and neighborhood or condo association fees. Nearly 20 percent of Floridians are spending more than half of their incomes on housing.
Surging Median Home Values
Median home values are far outpacing the rent rates due to the increased demand from new residents. This upward trend has a far-reaching impact on affordability for low-wage workers, making it difficult for them to own a home and driving demand for affordable rental housing.
Only 31 affordable rental units are available for every 100 renters who make less than 30% of the median income in their area, the report indicated.
Declining lower-cost housing Units
Restrictions on local land-use and impact fees have led to an increase in construction costs, preventing the development of smaller, lower-cost housing units, such as apartments, mobile homes, and mother-in-law suites.
The sample Fair Market Rent for a modest two-bedroom apartment is $1,351 in Miami, $1,387 in Fort Lauderdale and $1,422 in West Palm Beach, the report stated.
Top Five Most-Expensive Areas in Florida Based on Hourly Wage (needed to afford an average two-bedroom apartment)
Monroe County - $29.12
West Palm Beach -$27.35
Fort Lauderdale p-$26.67
Miami - $25.98
Read the full report here.