MIAMI – The housing and rental market has been hit extremely hard as inflation concerns rise across the nation.
Real estate economist Ken H. Johnson says South Florida homes are overvalued.
“We are definitely and probably the worst housing affordability prices that we’ve seen in Miami in the last 40 years,” said Johnson. “Miami metro, which is all the way up through Palm Beach County, is pricing out at roughly 30 percent above this long-term pricing trip. Rental markets in Miami are roughly 22 percent above their long-term premium. That make that the most overpriced market in the country.”
Couple that with the price of just about everything going up.
“Inflation, higher gas prices, higher food prices, higher materials labor, all these are putting a crunch on the individual family budget,” Johnson said.
Jonathan Alfonso runs Portal Real Estate and his own YouTube channel, doling out advice to his online viewers.
“A lot of people are being pushed to the brink right, but the question for me as a real estate professional is how does that translate into the housing market,” Alfonso said. “There still is such a massive demand for the very little inventory that we have that that inventory still going to fetch premium.”
Added Johnson: “We have a population influx even greater than or even greater than 12 years ago, and more importantly, we have a huge inventory shortage this time around.”
There is an influx of people moving in, competing with locals for the relatively few houses up for sale.
“We had that period of two years when interest rates are so low, and you also had so many people that were able to refinance our properties are very historic closed, so now there’s a bunch of people that are sitting with very low mortgage payments are like why am I gonna sell where am I going to go,” said Alfonso.
Said Johnson: “So what looks more likely is that we’re going to go into a prolonged period of unaffordable housing, either to own or rent, in the Miami metro. There’s not much easy way out of this other than to build units and do that as quickly as we can.”
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