Florida Rental Market

6 Minutes Read

Florida Rental Market Report

The beautiful state of Florida, arguably, is blessed with the best climate in the US and offers attractions too numerous to count.  There’s the boating, fishing, golf, tennis, white sand beaches and gorgeous homes with outdoor living amenities.

There are the communities, organized so well with recreational facilities used year round and HOA’s that encompass golf courses and parks.

Add to that, zero income taxes, pro-business government, landlord-friendly regulations, no rent controls, a severe housing shortage, large tourism base, comparatively lower property prices, lower property tax rate (.8% vs .99% nationally) and a shift of real estate investor interest to to the southern US states.

Buyers Eager for Florida Real Estate

Increasingly investors and home buyers from the Northern States, South America, Europe and Canada are looking for more balmy tax-friendly locations to live and invest. Few states can answer the call.  A flow of renters and homebuyers from costly California, New York, Massachusetts and other states is helping to keep upward pressure on property values and rent prices in Florida.

Competition for rental property purchases is fierce as the state’s economy is faring well, tourism is booming, and Latin Americans and Canadians really prefer South Florida. Although some media outlets consider Florida overpriced, a recovering US economy is likely to push home prices higher. See the Florida housing market report.

And as workers migrate to Florida’s diversified economy along with tech companies choosing to relocate here, it is changing Florida’s culture with big changes in the Miami-Dade region.

With what is likely the world’s most beautiful city skyline, Miami is enjoying phenomenal growth which has greatly grown the supply of multifamily buildings. Some view the City of Miami as the upcoming tech and banking capital for the entire nation.  With its direct access to the Caribbean and Europe, it’s hard to argue that it is uniquely positioned for that crown.

Across the state, numerous small cities and towns provide a paradise-like setting for vacationers, snowbirds, and incoming new permanent residents.  Single-family home construction has also flourished here and spawned significant growth in HOAs and community associations. Many buyers prefer to live in these communities.

Questions for Investors

The key question perhaps for US and International investors is whether Florida will remain a good place to buy real estate. How severe is the shortage and when will the glut of multifamily releases be absorbed? Are the prices too high and what is the ROI like?

Questions about the Sunshine State’s rental stock are many:  where are the best price-to-rent ratios, cash flow, positive cash flow, income potential, property taxes, quality neighborhoods, single-family and apartment prices, rent price trends, and how much are the costs of maintaining a rental in Florida?  And how much property do you get for your million-dollar investment here?

Brief Overview of the Florida Rental Market

Florida is ranked as the 16th largest economy in the world driven by a dynamic range of factors including agriculture, real estate, and tourism.

There is a trend in America to move to southern and southeast states, and with baby boomers retiring, there’s little to suggest this “Florida bound” trend will dissipate soon. With it’s excellent health and medical services and golf courses, it seems a haven to many older buyers. An estimated 1,000 people per day are moving to Florida adding to the 21 million already residing here.

All told, there is solid demand for rental houses and apartments. Florida isn’t exactly an inexpensive location and poverty and homelessness are an issue as they are in New York, Chicago, Philadelphia, Los Angeles and San Francisco. This will be a factor in choosing the right city and neighborhoods.

From Governor Ran DeSantis:

Florida’s labor force grew by 0.2 percentage points in October 2023, while the national labor force growth rate declined by 0.1 percentage points over the same time period. Florida continues to outpace the nation in labor force growth for a 29th consecutive month. Florida’s private sector employment increased by 0.3 percent (+25,900 jobs) over the month in October 2023. Florida’s unemployment rate was 2.8 percent in October 2023, more than a percentage point lower than the national rate of 3.9 percent and marking the 36th consecutive month Florida’s unemployment rate has remained below the nation’s. Florida’s construction industry experienced its fifth consecutive month of growth in October 2023 with 2,500 jobs added since September 2023. New construction permitting also continues to trend upward in Florida — from flgov.com

With a strong labor force growth, natural resources, strong investment, and in-migration into a thriving diverse economy, the big picture for rental demand and income looks solid.

Rent Prices in Florida

Not many forecasts for rent prices in Florida are being floated of late, although news stories abound with comments on slowing rent growth. It’s cooled a little as the lagging effects of FED rate hikes hit harder. But that’s this year where it might create an investible point for buyers like you.  No one can seem to predict how rent prices will go when mortgage rates drop.

Yet, we must remind ourselves that this market is complex with its US dollar, foreign buyer and tourism components. We might look at the rent trends and intuitively know it’s softening.

Rent prices range across the state with the highest rents present in Naples and Miami to the lowest in the Florida Panhandle. Rentdata.org reports on the most recent averages for various sizes of units.

In its recent report, Attom ranked 4 Florida counties near the top of the nation as strong markets for 2023 single-family investments: Palm Beach, Indian River, Collier and Charlotte counties.

Florida Multifamily Rental Market

A glut of new construction has resulted in lower rent prices. RealDeal reports that in the first 3 quarters of 2023, 13,388 apartments in South Florida were built, more than all of 2022 combined (13,210).

Zumper’s latest rent data shows very strong rent price growth continues in many smaller Florida cities.

  1 Bedroom Rentals 2 Bedroom Rentals
City Price M/M% Y/Y% Price M/M% Y/Y%
Naples, FL $3,472.00 13.00% 5.00% $5,747.00 24 2
Miami, FL $2,745.00 -3.00% 0.10% $3,792.00 3 4
Sarasota, FL $2,294.00 43.00% 16.00% $3,428.00 26 -3
Fort Lauderdale, FL $2,000.00 -1.50% -5.7.0% $2,800.00 -3.4 -5.7
Fort Myers, FL $1,778.00 15.00% 4.00% $2,791.00 7 5
Tampa FL $1,701.00 16.00% Even $2,214.00 -3 -4
St. Petersburg, FL $1,450.00 -3.30% -5.20% $2,000.00 -3.4 -8.3
Kissimmee, FL $1,519.00 2.00% 13.00% $1,965.00 9 8
Orlando, FL $1,570.00 0.60% -7.10% $1,850.00 -1.1 -6.1
Daytona Beach $1,307.00 2.00% Even $1,794.00 15 8
Jacksonville, FL $1,270.00 -0.80% 1.60% $1,450.00 -0.7 -2
Tallahassee, FL $1,162.00 8.00% 18.00% $1,351.00 9 9
* Stats Courtesy of Zumper


According to Miami Realtors, as of June 2023, the median multifamily asking rents were 20% to 40% higher than the mortgage payment on a condominium or townhome purchased at the median sales price in Miami-Dade ($3,100 median asking rent vs. $2,435 mortgage payment), Broward ($2,300 vs. $1,631), Palm Beach ($2,450 vs. $1,893), and Martin ($2,100 vs. $1,782). While the challenge for renters wishing to buy is obvious, it lends support to multifamily unit purchases by investors who receive the rent premium bonus plus tax deductions.

As we quoted Attom Data in the Best Florida cities for rental investment report, the yields have been best in the Miami/Fort Lauderdale/Palm Beach region.

The biggest increases in potential annual gross rental yields from 2022 to 2023 among counties with a population of at least 1 million are in Miami-Dade County, FL (yield up 34.1%); Broward County (Fort Lauderdale), FL (yield up 32.4%);  and Palm Beach County (West Palm Beach), FL (yield up 29.5%). — Attomdata report.

Florida Realtors Reports on Yields

Florida Realtors notes Florida counties with US leading upward-trending single-family rental yields:

  1. Indian River County FL: 15%
  2. Collier County FL: 14.7%
  3. Wayne County, Michigan: 13%
  4. Mercer County, New Jersey: 12.7%
  5. Charlotte County: 12%

Highest predicted 2023 yields for counties with a population 1 million+:

  1. Wayne County, Michigan: 13%
  2. Cook County, Illinois: 11.5%
  3. Cuyahoga County, Ohio: 10.1%
  4. Oakland County, Michigan: 9.1%
  5. Palm Beach County FL: 8.5%

Top current increases in annual gross rental yields (2022 to 2023)

  1. Orange County, Calif.: Up 42.7%
  2. Miami-Dade County FL: Up 34.1%
  3. Broward County: Up 32.4%
  4. Santa Clara County, Calif.: Up 30.1%)
  5. Palm Beach County FL: Up 29.5%

Excellent Cap Rates

Cap rates in Florida (price/annual rent revenue) are very attractive they range from an ultra high 27.6 in Forest City to an ultralow of .21 in Dania).  Cap rates in Miami (5.2), Tampa (7.14), Orlando (6.73) and Tallahassee (6.7) are very inviting given the continuous demand for rentals whether long-term or shorter term.

View a full list of the Cap Rates for all Florida towns and cities Caprateindex.com.

Best Types of Rental Property to Buy in Florida

Investors will enjoy a wide variety of investible property types that range from single-family houses to condo and apartments to duplex, triplex and quadplex multifamily units.

In general, discover more on the best types of rental properties to invest in.

Ready to manage your rental properties professionally?  Call 415 800 1245 to learn more about how ManageCasa property management software will help.

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