Renters can take a breath. The big rent increases seem to be slowing down.
The Redfin national brokerage firm reports that while the pace of rent increases is moderating, gradual increases may be seen through the rest of the year.
Nationally, monthly rents increased by 14% in July to a median $2,032. That is the smallest increase since November and increases have been dropping since May.
Seattle-based Redfin reports Jacksonville’s median monthly rental rate at $1,661.
Other Florida cities have higher rents. Orlando is $2,164; Tampa, $2,227; and Fort Lauderdale, West Palm Beach and Miami, $3,068,
Even if they have plateaued, a new baseline for rent has been set throughout the country.
Several factors caused the explosion in rent prices, Redfin Chief Economist Daryl Fairweather said in an interview.
“The rental market was pretty slow. During the pandemic, though, because of the eviction moratorium, many people just weren’t signing leases, they were just staying where they were.”
Remote work and early retirements played a part as well.
The migration of people from expensive states that pushed home prices to record highs spilled over into the rental market once landlords were able to recoup lost rents and saw that demand would allow for rent increases.
“So now it’s kind of like the hangover from all that extra demand that we saw earlier, prices went up so much that landlords thought they could push their units for an exorbitant price,” Fairweather said.
Rent increases are slowing because the market has reached its threshold, he said. The deals that Jacksonville offered a year ago are no longer there.
Renters facing higher rents have few options. Fairweather said if a renter is in good standing, having paid rent on time, caused no complaints and generally stayed off the landlord’s radar, there is a better chance of negotiating a lower rent increase, she said.
“It is risky to find a new tenant and never know what you’re going to get when you add a new stranger in your rental.”
Renters no longer able to afford increased rent prices may have to move, she said. Commuting costs may escalate but probably not as much as the rent increase.
Government assistance
There have been calls from citizens around the state and in public comments at Jacksonville City Council meetings for government-imposed rent control, but that can only be a temporary measure in Florida.
During high interest rates in the 1970s, Miami Beach sought to impose rent control in 1975. Two years later the Florida Legislature restricted rent control initiatives.
The caveat is that cities can declare a rent emergency and place a rent control referendum on the ballot. Even if passed, the rent freeze lasts for only one year. Also, state law limits what apartments are eligible for rent-control protection.
The Business Observer, part of Observer Media Group, reported that an initiative passed in Orange County where rent control will be on the November ballot. However, such proposals failed in St. Petersburg and Tampa.
No rent control emergency has been declared in Jacksonville.
City Council President Terrance Freeman has established a Special Committee on Critical Quality of Life Issues to look at ways government can provide relief on the issues of health care, affordable housing and homelessness.
Chaired by Council member Michael Boylan, the committee will invite experts to collect ideas and propose solutions. The report is due Nov. 22.
“We are trying to get the experts in the room and hopefully not just come up with a solution that remedies the heartaches we’re having now but a solution that will extend out beyond the next couple months to something that is sustainable,” Freeman said.
Rent control isn’t off the table. Freeman wants the committee to be open to all ideas.
However, he does not want to place the burden on just one industry or sector of the local economy.
He would like to examine a proposal to change the comprehensive plan to allow construction, where appropriate, of 40-foot lots to increase density and affordability, he said.
Council member Reggie Gaffney filed bill 2022-0619 to allocate $3 million from the city’s $171 million federal American Rescue Plan funds to help residents pay rent and utility bills.
The money would be split three ways to provide $1 million for utility assistance, $1 million for rent assistance and $1 million for eligible nonprofits to alleviate crime in the county.
The bill is in committee.
Freeman wants to wait until the new budget is adopted at the end of September before exploring new spending bills.