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The price of rentals in Miami increases by 52.4% in one year

2022-02-23T03:21:50.881Z


Miami is now the fifth most expensive place to rent in the country after several California cities: San Jose, San Diego, Los Angeles and San Francisco.


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(CNN) --

Across the United States, rents are rising so fast that in many cities buying has become more affordable than renting, even with sky-high home sales prices.

The national median rental price rose 19.8% in January from a year earlier, marking the eighth consecutive month of double-digit increases, according to a report by Realtor.com.

The national median rent was $1,789 last month.

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"US rental markets are more than making up for lost time," said Danielle Hale, chief economist at Realtor.com.

Rents are now up 21% from January 2020, before the start of the pandemic.

The largest rent increase for January was in Florida's Miami, Fort Lauderdale and West Palm Beach, where median rent was $2,895 per month in January, up 52.4% from last year.

Miami is now the fifth most expensive place to rent in the country after several cities in California: San Jose, San Diego, Los Angeles and San Francisco.

The report found that the monthly cost of buying a starter home was more affordable than renting a similar-sized unit in more than half of the 50 largest US cities.

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While many people looking for an affordable place to live find themselves between a rock and a hard place as rental and home buying costs rise, a number of factors could tip the affordability scale in favor of homebuyers. housing for the first time this year, Hale said.

Rentals are projected to outpace listing price growth in 2022 and are already accelerating across all rental sizes.

In addition, the survey data shows that the majority of landlords plan to increase their asking rents even more this year.

where is better to buy

A 'For Rent' sign is displayed on an apartment building in Miami, Fla., on Jan. 20, 2022. - South Florida's home price growth is one of the highest in the U.S. (CHANDAN KHANNA/AFP via Getty Images)

Looking at median home prices and rents nationwide, the monthly cost of renting is still slightly cheaper than owning an initial home, according to the report.

But in 26 of the 50 largest cities, the monthly cost of buying a starter home was an average of 20.6%, or $323, less than renting one in January, according to Realtor.com.

Buying was most advantageous in Birmingham, Alabama, where the cost of buying an initial home was 44.3% less than the cost of renting in January.

Cleveland, Pittsburgh and St. Louis followed.

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Two Florida cities, Tampa and Orlando, experienced some of the fastest annual rent growth in January.

In Orlando buying was 27.1% cheaper than renting and in Tampa buying was 25.5%.

Just because it's better to buy than rent in a city doesn't mean home prices aren't making strong gains, it's often both.

In eight of the top 10 pro-buying markets, both the monthly cost of buying a starter home and renting one increased over the past year, according to the report.

The decision to rent or buy ultimately depends on personal circumstances, including location, financial situation, and how long the buyer intends to live in the home.

It's generally not financially favorable to buy if you plan to live in your home for less than a few years, and a common rule of thumb is to spend no more than 30% of your income on housing costs, Hale said.

Also, buying a home is much easier said than done in many markets, as the inventory of homes to buy is at an all-time low.

And as mortgage rates continue to rise, the clock is ticking.

Those looking to buy their first home in 2022 are more likely to find lower costs now than later in the year, Hale said.

But inventory isn't expected to improve until later this spring.

Where is it better to rent

Given skyrocketing home prices in some major cities, there are plenty of places where it's still more affordable to rent rather than dive into the high-priced, competitive real estate market, according to the report.

In January, the monthly purchase cost was 25% higher (or $536 more) than the rental cost in 24 of the 50 largest metro areas, on average.

Austin, Texas, was the city where it was more profitable to rent than to buy.

Monthly payments were about 76% higher, or $1,346 more, to buy a starter home in Austin than to rent, according to the analysis.

New York followed;

San Francisco;

Saint Joseph;

Seattle;

Boston;

Denver;

Rochester, New York;

Portland, Ore.;

and Los Angeles.

In these ten cities that favored renting, monthly payments for an initial home purchase were 41.6%, or $978, higher than rents, on average.

Homes for sale in those locations included a higher average proportion of condominiums than the national rate and more expensive homeowners association fees.

"Deciding when to transition from renting to owning for the first time depends a lot on life stage," Hale said.

"For young Americans like Gen Z, who may have moved home to save money during Covid, renting in a big tech city offers flexibility and relative affordability, even as rents pick up in these areas."

Miami

Source: cnnespanol

All news articles on 2022-02-23

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