During the National Association of Real Estate Editors’ (NAREE), a conference in Miami last June, there was a surprising statistic that took many attendees by surprise.
According to one of the head economists of Zillow.com, 47 percent was the median amount of monthly household income spent on median-priced rental properties in Sarasota – the highest in Southwest Florida.
This is a very high figure, especially considering the national average is 30 percent. Los Angeles tops the list with 50 percent.
An analysis revealed that a one-bedroom apartment had an average rental price of $1,100 per month (a five percent increase), while a two-bedroom unit costs an average of $1,420 monthly (a three percent increase). Both cases represent a year-over-year increase of 15 percent.
With these numbers, it basically means a household should earn around $40,000 in order to afford rent at the 30 percent figure.
Many experts point to Sarasota’s high volume of vacation homes, which may be affecting rental prices.
The statistic encompasses different areas in the metro, such as Bradenton, Englewood, North Port, Palmetto, and Venice. A few of these communities do not share the same rental inventory of more popular areas.
Other side effects of the high rental prices revealed during the conference were:
- During financial emergencies, around 60 percent of high-rent households were unable to cover about three months’ worth of expenses.
- Households burdened by high rent tend to sacrifice medical care in order to gain more financial stability.
In order to solve this affordability issue, many believe that one solution is to increase the number of rental properties throughout the area.
Economic development officials in Manatee County are also pushing for affordable rental prices for working residents. They believe that the demand for employees in the retail and hospitality sectors place a significant percentage of the county’s working population in low-income brackets.