Orlando ranks 3rd toughest city to rent an apartment in the US – Orlando Sentinel
Orlando had the third most competitive rental market in the country in 2022, with an average of 21 applicants per unit, according to to a new report on the RentCafe apartment search website.
The report also revealed that apartments in Orlando remained vacant for less than a month on average.
Grand Rapids, Mich., was No. 2 in the survey while Miami-Dade came in at No. 1 with 32 applicants per apartment.
While housing advocates have called for more apartments, one economist said Orlando could ease some of the pressure if fewer homes and condos were limited to short-term rentals for tourists.
“We have potential units that we could get to market fairly quickly with the change of a few hearts and minds,” said Ken H. Johnson, real estate economist at Florida Atlantic University.
Competition fueled an explosion in rental prices last year. Orlando’s average monthly rent was $2,008 in November, according to a rental index Johnson helped producealmost 10% above the same period the previous year.
“We have these high rental rates … in Florida when they’re going down in much of the rest of the world,” Johnson said.
Demand across Florida was high as the population grew nearly 2%, according to the Census Bureau, the first time in 2022 in more than 60 years that Florida had the fastest population growth.
“Most of this is due to a lack of supply,” said Doug Ressler, principal analyst for Yardi Matrix, which provided data for the RentCafe report. “Supply just hasn’t been able to keep up with demand.”
While economists often point to the dramatic drop in new construction after the Great Recession of 2008 as the reason for tight supply, Johnson said Orlando and many cities, especially Florida, have more supply than they do. don’t use it.
Johnson said with high rents and competition, economists would expect a high number of people to live in each unit. But Orlando’s density is 2.54 people per unit, slightly less than the national average, according to Johnson.
“You’re just at or even below the average number of people living in units across the country,” he said. “So why are the prices so high?
Johnson said he believed it was because homes and apartments used as short-term rentals on sites such as Airbnb or VRBO were vacant.
“No one has any idea of the total number [of vacation properties]but it is substantial,” he said.
He also points out that HOAs and condo associations are too restrictive when it comes to renting empty units.
“Even if they were on the market for sale, it would help the rental market as a whole in Florida,” he said.
HOAs and governments would likely face opposition from resident landlords who complain about noise and damage to homes and condos where renters come and go by the day or week.
Johnson says the long-term solution is still to build more homes and apartments, but Ressler points out the solution is too far away for people looking now.
“To build a 50-unit building, it takes a good 36 months from the time you put a shovel in the ground to complete it,” Ressler said. “And it was extended due to the [pandemic-related] supply chain issues.
Ressler said he expects 95% occupancy nationwide in 2023, even with 430,000 new apartments expected to become available this year. With rising mortgage rates, Ressler said pressure on rentals will remain high as more people find themselves priced out.
Metro Orlando, which includes Orange, Osceola and Seminole counties, has an apartment vacancy rate of 7.4%, according to real estate analysts CoStar Group. Last year, the metro saw the construction of 7,912 new apartments, with another 12,000 expected this year, according to CoStar.
Johnson said he realizes that turning empty units into rentals probably won’t be enough to end Central Florida’s housing crisis, but every little bit can help.
“We talk about things like rent control and we don’t even look at streets where the lights aren’t on,” he said.