Miami had a vacancy rate of 12.65% for 2.6 million apartments, trailing only New Orleans (13.88%). The national average for the 50 largest metropolitan areas included in the study was 7.22%.
LendingTree used the latest data from the U.S. Census Bureau’s American Community Survey to compile the list and analyze the reasons why a region’s vacancy rate can be important in understanding the health and character of its real estate market.
“So there are a lot of reasons why Miami has such a high vacancy rate, but a really big reason is the fact that it’s a really popular place for second homes,” senior economist Jacob Channel, the report’s author, told NBC6 .
“So if you look at the total number of vacant units in Miami, more than half of them are vacant because they are only used part of the year,” he added.
There are over 339,000 vacant homes in Miami and 53.32% of these homes are used for seasonal or recreational purposes such as vacation homes or simply as a weekend home.
At first glance, one might think that supply must be very high due to the high vacancy rate in the area, which should drive prices down.
According to the report, Miami is a special and unique case as it is a destination with many lucrative features that make it ideal for wealthy investors to purchase real estate.
“I think, as our study shows, vacant homes are often not necessarily immediately available, particularly in the case of Miami, where a lot of vacant homes are owned by someone and are not used year-round, particularly in terms of rental units,” Channel said .
LendingTree also notes that the vacancy rate may fluctuate from day to day as it also takes into account apartments or houses that are on the market for sale/rent. Apartments and houses that have already been sold or rented but not yet occupied are also taken into account.
If you’re looking for a new home, there are some tips that can help you find the right deal.
House Hunting Tips:
- Find the best possible interest rate: Look at several other lenders and try to find the best interest rate. Lenders often compete for your business, and if you shop locally, you may be able to secure a lower interest rate.
- Remember the essentials: Think about how much you need to pay for food, clothing, health insurance, education (if you have children), and any other expenses you also need to pay.
- Get Pre-Approved for Your Mortgage – With the mortgage ratio hovering steadily around the 7% mark, the best thing you can do is get pre-approved from your mortgage lender as this will speed up the process and give you an idea of how much you need to spend and lets the seller know you are serious about your offer.
The process of changing the trend and keeping home prices low is no easy task, but LendingTree recommends continually putting pressure on local, state and federal governments to “incentivize and build more lower-income housing units.”