After a few years spent atop the “Most Unaffordable” list that no region wants to lead, Miami-Dade officials say a tipping point for the housing crisis is soon approaching.
The clank of construction is unavoidable in the urban center of Miami-Dade County, from Brickell and downtown to Little Havana, Brownsville, Allapattah and Liberty City.
It's the sound of salvation, say county leaders.
“The only way you're going to get out of this is you've got to build,” Alex Ballina, director of Miami-Dade Public Housing and Community Development, recently told WLRN. “You’ve got to create that supply and demand equilibrium. And right now we're on the other side of it, but by early next year you'll start seeing that shift because we're going to have more supply than we are demand.”
The expected drop in rents, cautioned Ballina, will not be as abrupt as how quickly rents rose since 2020 but the expected relief will be real.
“Rents are already stabilizing,” he said. “If you go look for an apartment right now, chances are very high that you're going to get offered a concession. You're going to get a free month's rent. They're going to help you with some of the security deposit because vacancies are creeping up, because we're getting to that inflection point, that rents have gotten to a point that people can't keep up.”
Median rents in Miami have already dropped by $301 compared to last year, according to Zillow.
Ballina, who has only been in the position for a few months, is currently overseeing a building boom not just of luxury apartments that South Florida has become famous for, but of government-funded construction, with strings attached.
Compared to early 2021, Miami-Dade County has now doubled its investment into affordable and workforce housing projects, according to department reports. The county has $260 million committed to projects right now, with many of them currently under construction.
In early 2021, the county had $128 million invested in those projects.
In exchange for public dollars, tax incentives, and access to publicly owned land, developers agree to ensure the developments house people in low and middle income brackets. Rents as a percentage of someone’s income are capped.
Ballina took WLRN on a tour of many developments under construction and some that have recently opened up. A case in point: the Three Round Towers project in Allapattah. The three towers, first built in 1974, have been completely renovated in recent years, and additional buildings have been added to the plot on formerly vacant parts of the seven-acre plot.
Just a few weeks ago, the Brisas Del Este building, with 161 income-restricted apartments, was completed. Rent for a 1-bedroom apartment starts at $929.
The median rent for a 1-bedroom apartment in the City of Miami is $2,699, according to Zillow.
“The most difficult thing that we have is land,” said Ballina. “So we rehabbed the three existing [buildings] and created another 500 units around it. That's utilizing our resources to the best of our ability.”
Josh Rosengarden declined to say how much he pays in rent, but he has lived in one of the renovated buildings for a year now and says the kind of deal he has would have flatly been impossible in the general market.
“Honestly the impression I get when I’m in this building is that I’m tenant of a building in Brickell or in Boca Raton, where the rent is probably triple the amount,” he said.
Most of the developments being completed right now received funding before 2021, when the housing crisis truly entered into a frenzy. The sharp increase in public funding for projects since then will make sure more is coming down the pipeline.
“It's my number one priority, helping people be housed here,” said Miami-Dade Mayor Daniella Levine Cava.
The bulk of the publicly-funded developments are in the City of Miami and in South Dade. The county typically chips in up to 5 percent of development costs to help private developers bring projects to completion.
The formula means the county is able to negotiate income restrictions on a wide variety of developments across the county.
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“Fifteen projects were able to be completed — development projects — because we put money that they weren't expecting right into the projects that otherwise would have stalled. Those units would not have come online. We made the commitment to 18,000 overall additional units on top of the 14,000 that were in process from the previous administration. So a total of 32,000,” said Levine Cava.
The county is not the primary source of funds for these developments, and they remain primarily privately owned. Ballina said that’s mostly because the cost of building is about $300,000 per unit, a rate that has only increased in recent years as labor and material costs have soared.
If the county decided to build 10,000 units on its own, he hypothesized, it would cost $3 billion.
“That’s the big obstacle. We need capital, we need land and we need innovation,” said Ballina.
Recently completed developments include:
- Twelve units in Homestead designated for low-income tenants with HIV/ AIDS.
- Ninety-seven units out of 244 at the Lil’ Abner Apartments near Florida International University that are designated for low-income seniors.
- And 134 new units for low- and middle-income families at the Lincoln Gardens development in Brownsville.
On top of the local-taxpayer funded projects, public housing developments are currently in the process of being redeveloped with federal dollars.
Major renovations of housing projects in Liberty City, Allapattah and Overtown are currently in progress. Those redevelopments will replace aging public housing units, while adding additional income-capped units and even market-priced units onto the sites.
With so much land already developed from the Atlantic in the east to the Everglades in the west, said Ballina, the core focus is on building denser areas and getting away from sparsely-populated development. A state law passed earlier this year, SB 102, the "Live Local Act," is encouraging dense development, so long as criteria for affordable or workforce housing is met.
“We're living through history right now,” said Ballina. “You're seeing the evolution of Miami Dade County become a metropolitan area, almost like a Hong Kong type of effect.”
The centerpiece of this new vision is the River Parc campus in the heart of Little Havana, just across from the LoanDepot Park, home to the Miami Marlins baseball team, bordering the Miami River. Affordable housing has been here since the 1960s, but renovations are taking place and several new buildings are being built as part of a billion dollar masterplan.
The campus has a newly renovated eating hall for seniors, a convenience store under a building, and at a beauty salon.
The brand new Paseo Del Rio building was just completed, with 182 new income-capped apartments, the newest addition to the campus. A branch of Pinecrest Bakery is being built on the bottom floor.
The footprint of the River Parc campus is quickly turning into a densely-populated, self-contained island of the city.
“We went from 800 units, give or take, to 2,353,” said Ballina, speaking of the masterplan. “And it’s in the heart of Miami-Dade County.”
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Most of the construction that is taking place now was financed before interest rates sharply rose starting in 2021, said Ballina. The current high interest rates leaves a little bit of a question in the air about how much construction will be coming over the next few years.
But the county learned hard lessons in the wake of the pandemic, as it became the epicenter of the nation's housing affordability crisis.
The county now truly understands that it cannot let up in playing a major role in development moving forward, Ballina said.
“We’ve got to start thinking ahead, because we hadn't been doing that for a very long time. We got caught, right? And then we didn't have enough supply for the immense demand,” he said. “Now we're thinking forward and we're really getting creative in terms of making sure that we have a strategy.”
WLRN has compiled a list of resources for those seeking help in renting or owning in South Florida.
