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Expert says lack of earning and the 'right kind of housing' keeps Florida in an affordable housing crisis

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A man carrying his bedding walks past the Miami Jewelry Pawn Shop on Thursday, May 7, 2020, in Miami. (AP Photo/Lynne Sladky)

Parts of Florida consistently rank as some of the most unaffordable places to live with the combination of low incomes and high housing costs.

Housing, and the inability of many Americans to afford safe and stable housing, is "the biggest crisis in this country."

So says Andrew Ross, who has studied and reported on Florida's housing market for years. Ross is the author of "Sunbelt Blues: The Failure of American Housing."

He spent time among Floridians without permanent housing, staying in rundown extended-stay motels where residents don’t have to come up with a first and last month’s security deposit and they can pay by the week. He joined people without any home in encampments, often barely hidden from tourist attractions and daily commutes.

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Ross is a professor of social and cultural analysis at New York University. His new book focuses on the housing problems and the people affected by it around Orlando. And what he found there, resonates in South Florida; spiraling housing costs, dwindling supply of middle-income homes, lower average pay dominated by hospitality jobs, a reliance on weekly-pay motels for housing, and increasing demand as more people move to Florida.

Barely a week goes by without some kind of survey or ranking showing how expensive it can be to live in Florida — especially in large metropolitan areas like South Florida.

Monthly rents are rising faster in Miami, Orlando and Tampa than almost any other area of the country. While the pandemic initially had landlords hitting pause on rent hikes, monthly rates have shot higher as eviction moratoriums have expired and demand has shot up.

COVID-19 did not interrupt what has become nearly a decade of rising home prices. The usual drivers of Florida real estate — sunshine and no income taxes — coupled with the movement to work-from-anywhere and historically low interest rates for those who qualify, have fueled a fury of home buying — driving up prices.

While the cost of housing continues getting more expensive, incomes have not kept pace. The average price of an existing condominium in Miami is up 24% over the past year. The average price of a single family home in South Florida is close to half a million dollars.

"We do have a national housing crisis," said Ross. "In the course of the pandemic, we've seen prices soaring and rents also on a hike. We're not really faced with an emergency rather than a crisis."

Housing affordability is and has been a challenge in parts of Florida for years. In the simplest terms, Ross defines this emergency as a mismatch between what people earn and their inability to find housing that is affordable to them.

"We've seen a bottleneck in housing supply and a rise in renters over the last decade — which has been really quite pronounced —and a corresponding decline in homeownership. The stabilizing factors in the housing market for decades have become a little bit unmoored and unanswered. And that's one of the reasons why things are out of whack, as it were," Ross said.

Among those, he said, are investor-owned properties — especially large corporate owners, such as private equity firms, that swooped in after Florida was on the forefront of the housing collapse more than a decade ago.

Housing affordability is a complex calculation, but it starts with the fundamental economic force of supply and demand.

The lure of Florida has been an enduring force that continues shaping the state. More people moving to Florida is so important that the state government’s own economic research agency declared in 2020, "population growth is the state’s primary engine of economic growth, fueling both employment and income growth."

It is an important reminder when thinking about how policymakers may address the challenge of housing affordability. Any solutions to increasingly unaffordable homes and apartments would have to balance the need for population growth with Florida’s fragile environment, choked transportation systems, and squeezed geography — shaped by water.

The only brake on Florida’s persistent generations-long population growth has been real estate. The housing collapse and Great Recession interrupted years of migration to Florida, but only for a short-time.

The pandemic has not paused the population trends.

Over the past decade, South Florida’s population has grown by about 10%. Osceola County in Central Florida has grown by nearly 40%, making it the fastest growing county in the state.

"A lot of these folks are not well-heeled," said Ross. "They don't belong to the well-heeled, retiree class. They are economic fugitives coming because they've heard that jobs are plentiful, especially in the tourism hospitality industry. A lot of them end up either homeless or living in motels or really struggling to find a roof over their heads. So there's a lot of demand there."

In the meantime, home building also continues, but not the type of homes necessary to meet demands according to Ross. New building permits in Florida for single family homes hit a post-Great Recession high in June.

"The problem is not that houses are not being built," said Ross. "There's a lot of development going on. It's just not the right kind of housing that's being built. It's out of sync with local needs."

Ross points to the shrinking supply of homes affordable for an average income. The supply of single family homes for sale across all prices was down to two months or less in South Florida in September, according to the Miami Association of Realtors.

"Developers and builders don't find that kind of construction to be particularly lucrative. They're following the market. They're following the profit, and the profit is in much bigger houses," Ross said.

The effort to find the right economic scales to encourage more affordable housing puts pressure on local governments to find more land — "sprawl," is how Ross described it. And that has increasingly environmental consequences by developing once natural areas, oftentimes far away from employment centers, forcing residents to deal with longer commutes.

"You look at any region in Florida and you'll find that struggle going on. Communities [are] really having great difficulty housing incoming populations in a sustainable way," he said.

Homelessness in Florida has been improving. In 2007, 48,000 people were living in Florida without a permanent home, according to data from the federal government. That had been cut almost in half by 2020. Most are adult men.

A more detailed look at homelessness tells a deeper story of the people affected. More than 91,000 Florida school kids experienced homelessness during the year before the pandemic began, according to data from the U.S. Department of Education.

Of those children, 11,000 spent their nights in what have become shelters — motels. That is more than any other state except California, which has a much larger population than Florida.

Ross called these extended-stay motels a "default" option for people who can't find affordable housing. The motels do not require two months of rent or a security deposit like many apartments may, nor a down payment for a home mortgage. And there's no separate utility bills.

"There is a large, informal economy," said Ross. "There's a drug economy. There's a sex work economy that is also very active in the motels."

Florida has not had a state agency directly involved with managing real estate development growth for a decade. The Florida Department of Community Affairs was dismantled in 2011 after the state Legislature passed, and then-Governor Rick Scott signed into law, a bill reorganizing the agency, setting a new direction for how the state would manage demands of a growing population and real estate development.

It undid many of the rules that had been in place since 1985, when Florida’s law governing development was seen as the toughest in the nation. Easing restrictions on development and builders has not addressed the housing problem, though.

"What has failed is the total reliance of our housing delivery system on market-based means and relying entirely on private builders and developers to step up and produce affordable housing, which they really have never done for low-income populations," Ross said. "But now that the housing crisis has moved up into the middle-class portions of the population, the challenge is even more more serious."

In a journalism career covering news from high global finance to neighborhood infrastructure, Tom Hudson is the Vice President of News and Special Correspondent for WLRN. He hosts and produces the Sunshine Economy and anchors the Florida Roundup in addition to leading the organization's news engagement strategy.