Of all the numbers – interesting, provocative or inspiring – that were tossed about the lecture hall at the National Association of Real Estate Editors’ spring conference a week ago in Miami, the one that stuck with me the most was 47.
As in, the median amount of monthly household income spent on rent in the median-priced rental house was 47 percent.
Where? San Francisco? No. Manhattan? No.
Sarasota? Yes.
That statistic was presented by Stan Humphries, chief economist of Zillow.com, the online residential real estate market information website.
“Sarasotans are spending 47 percent of household income to rent the median rental property. About 27 percent of adults in Sarasota are doubled-up in those homes,” said Humphries.
“That is very high. The national average is 30. A lot of that is probably because Sarasota has a lot of vacation homes that are pushing up the rent paid.”
It is a metro-wide number, Humphries said, so it includes Bradenton, Palmetto, Venice, North Port and Englewood. Some of those communities don’t have the rental inventory of, say, Anna Maria Island, leading Humphries to tell me:
“You need to build more rental properties down there. You have an affordability issue.”
Renters I’ve spoken with have confirmed that.
Los Angeles was No. 1 on the chart at about 50 percent.
Zillow also reported some rather disturbing side effects of this statistic:
-- Almost 60 percent of households with the highest rent burden could not cover three months’ worth of expenses in the event of a financial emergency.
-- High rent-burdened households also are more likely to sacrifice medical care to make ends meet than other households. Preventive care is the first thing to get cut from the budget.
Also from Miami
The conference was held at the Hotel Intercontinental, which has a prime location right in the middle of downtown, just steps from where the Miami River meets Biscayne Bay.
Guests, when not tweeting from the conference all day, enjoyed views of the skyline, the cruise ships in the port and even Miami Beach.
Miami's Brickell district as seen from a walkawy along the Miami River. Staff photo / Harold Bubil; 6-25-2015.
Just to the south, across a bridge over the river, is the Brickell Avenue district, which is dense with architecturally impressive condo and office towers, 40 stories or taller, along with shops and restaurants galore.
On top of what is there already (see photo), developers are planning 32 new towers with more than 10,050 units in the Brickell area south of downtown. I have no idea where they will all go, but Peter Zalewski, who spoke at NAREE and runs a website called CraneSpotters.com, says developers will have to go west, away from the bay. He calls Brickell “the hottest address,” despite high prices and heavy traffic.
This area is popular with Miami’s influx of international buyers. There is a lot of anecdotal evidence that Brazilians and other South Americans are pouring into the South Florida market, buying condos for all-cash as a safe haven for their money. The relative safety of the area, compared with back home, doesn’t hurt the market’s reputation, either.
Nationally, though, the top 5 countries that are exporting buyers to the U.S. are not from South America, according to a new report from the National Association of Realtors’ research department. NAR reports that foreign buyers purchased $104 billion worth of U.S. property from April 2014 to March 2015, based on a survey of Realtors about existing home sales to resident and non-resident foreigners.
China led the way with $28.6 billion worth of purchases, followed by Canada at $11.2 billion, India at $7.9 billion, Mexico at $4.98 billion and the United Kingdom at $3.8 billion. These five countries accounted for 51 percent of sales to foreigners.
Fifty percent of international sales were in Florida (21 percent), California (16), Texas (8) and Arizona (5). Foreign buyers spend about $500,000 on average for a residence; the average American spends $256,000. All-cash deals accounted for 55 percent of sales to foreigners.
