Residential rents in Miami’s urban core continue heading higher, according to a report prepared for the Miami Downtown Development Authority by Integra Realty Resources. But those increases should start to taper off next year as a new supply of apartments and condos comes online.
Lease rates in downtown Miami jumped 6 percent through the first nine months of 2014, from the year-ago period, the firm said in a third-quarter residential market study.
For the greater downtown area, the average condo leasing prices for the third quarter were $2,054 per month, or $2.50 per square foot, for a one-bedroom unit and $2,947 a month, or $2.33 per square foot, for a two-bedroom unit, according to the report.
Rents in conventional apartment buildings were cheaper, averaging $1,605 a month, or $1.86 per square foot, for a one-bedroom unit, and $2,106 a month, or $1.73 per square foot, for a two-bedroom unit, the report said.
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Looking ahead, the DDA study projects that downtown rents, after a long stretch of brisk gains, will moderate in 2015 as the completion of new apartment and condo projects in the area provides more options for renters.
According to the report, about 2,300 new apartment units are set to be completed in the next 24 months. That will nearly double the inventory of professionally managed apartments and “constrain rising rental rates that are currently pricing many potential renters out of the Downtown Miami market,’’ the Integra study said.
Adding to the supply will be a host of new condo towers slated for completion in the downtown area. The investor-oriented condo projects have attracted mostly foreign buyers, many of whom are likely to lease them out.