Brickell condo, apartment rents soar 13% in year
By Marilyn Bowden
Both apartment and condo rental rates in Brickell are skyrocketing, and brokers say high-quality units are much in demand.
"A lot of people who are moving for the first time to Miami are still under the impression that they can get steals here," said Douglas Elliman Realtor Associate Dean Bloch. "That's really not the case. But Brickell is still less expensive than renting on South Beach, and you get more for your money. So students and young professionals love the area."
The overall average rent in a Brickell apartment project leaped from $1,943 a month in February 2010 to $2,197 this February, said L. Keith White, president of Reinhold P. Wolff Economic Research. "That is really substantial - a 13.1% hike," he said. "That would not be sustainable for a longer period of time. The market is catching up from the depressed rents of the past few years."
He quoted current average rents at $1,686 for a one-bedroom apartment, $2,551 for a two-bedroom and $3,038 for a three-bedroom.
"Overall vacancy is quite low - 2.5%," Mr. White said, a sharp decline from 9.6% a year ago.
The majority of rental opportunities in Brickell these days are condo units, either investor- or developer-owned. That market, too, said Chris Basick, managing broker of Esslinger Wooten Maxwell's Brickell office, is "nothing but good."
Right now, he said, 606 available units with asking rents ranging from $950-$20,000 are shown in the multiple listing service. About 53% are two-bedroom units, 33% are one-bedrooms and 10% are three-bedrooms.
"The inventory is not as much as we would expect," Mr. Basick said, "because many units are being used as second or third homes, so they're not being rented out."
The average actual monthly rate comes to $2.18 per square foot, getting closer to the average asking rate, he said, which is currently $2.23 a square foot. For a long time, actual rents were stuck at around $1.90 a foot.
That's good news for investors, Mr. Basick said. "Their expected revenue is higher than it was, and we are able to rent them out faster."
"The rental market has picked up tremendously over the past year," said Ty Forkner, a Realtor associate at Douglas Elliman Florida. "One-bedroom units that used to rent for $1,000 are now renting for $1,300-$1,500. Good quality inventory has really shrunk."
Mr. Bloch, who has sold quite a few downtown and Brickell condos to investors, said most plan on renting them out for five to seven years.
"The Icon is renting like crazy," he said. "A unit I just sold at The View at Brickell for $215,000 is rented at $2,200 a month, which is a good return."
Young professionals are big in the rental market, Mr. Forkner said. So are people who have lost their homes to foreclosures or short sales and who "have to live somewhere. They can't buy another house.
"What is really moving off the shelf is the luxury rental inventory. People who are downsizing from estates are looking for three to five bedrooms."
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