It’s no secret that the cost of multifamily housing in South Florida has skyrocketed over the past year, as rents jumped more than 20%.
But the days of exorbitant rent hikes are soon coming to an end, industry insiders say.
For owners of existing apartment buildings, it’s rising mortgage rates and insurance premiums that are onerous.
“I have clients who are seeing a 20% to 30% increase in their insurance – sometimes higher,” said Dan Dratch, Franklin Street’s director of multifamily investment sales in South Florida.
Franklin Street’s Dratch said he’s also noticed a slow down in the pace of deals.
This could translate into an opportunity for investors who may have been aggressive about buying multifamily properties these past two years to sell later on.
“Right now, the owners are dealing with expenses and lending issues,” he said. “But the rent [income] hasn’t slowed down.”