Miami Multifamily Report – Spring 2020
Following a healthy 2019, Southeast Florida's rental market is in for a big test this year.
In 2019, Miami was among the healthiest multifamily markets in the U.S., fueled by above-trend job gains and positive demographic trends. However, rent growth started decelerating in the last quarter of 2019, partially due to a strong wave of new supply. The early effects of the coronavirus crisis started to emerge at the end of this year’s first quarter, further dampening growth. Rates were up 0.2 percent on a trailing three-month basis as of March.
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The metro gained 43,000 jobs in 2019 for a 1.9 percent uptick, 10 basis points above the U.S. figure. Alongside Dallas, Las Vegas, Orlando and Phoenix, Miami has consistently ranked among the top metros for job and population growth since the last recession. According to Yardi Matrix data, one-third of Miami’s labor force is in high-risk sectors impacted by the pandemic. Although Florida is diversifying, its economy depends heavily on tourism, the hardest-hit sector. According to state officials, some 1.7 million people had filed unemployment claims as of April 21.
Miami added almost 2,000 units to its multifamily stock in the first quarter, all targeting the Lifestyle segment. With many residents working in relatively low-paying industries that have been highly impacted by the COVID-19 lockdown, demand for Renter-by-Necessity assets is likely to record increased volatility in the short and medium term.