Apartment rents boom in Bradenton, Sarasota markets
MANATEE -- The price to rent an apartment in Manatee and Sarasota counties has jumped in 2015, notching increases that approach some of the biggest markets in the nation.
According to a monthly rent report published by online rental marketplace Apartment List, local rents have become decidedly big city during the past 12 months. On average, monthly rent for a two-bedroom apartment has increased 5.2 percent in Bradenton and 8.8 percent in Sarasota. Both figures are ahead of the 4-percent national rate.
Tampa notched the second-highest average apartment rent increase in the past year for big U.S. cities -- 11.5 percent -- and was the top-gaining city in Florida. Vancouver, Wash., saw the biggest surge as rents increased over 17 percent between November 2014 and November 2015. Most cities in the top 10 saw increases between 8 and 10 percent.
The upward trend has set off an apartment-building boom in Manatee County, which could see more than 2,700 new units come online between projects completed in the past two years and those that have filed site plans.
But the new housing is not making the two-county area more affordable for low-wage workers. The average asking rent for a two-bedroom apartment in Sarasota County was about $1,170 at the end of September, according to commercial real estate information provider CoStar. In Manatee County, the figure was $1,060.
Joe McClash, owner of Manatee-based McClash Rentals, said a healthier apartment market has allowed him to increase rents after cutting them steeply during the Great Recession. The duplexes that make up the majority of his estimated 150 units are considered to be affordable by most measures, with three-bedroom units going for about $875 a month. That's up from the $650 the company charged a few years ago to fill vacancies left by tenants who had lost their jobs.
From his perspective as a landlord, today's market couldn't be more different.
"For the most part, there is nothing available in the market right now," McClash said. "There's very, very few days a unit comes available that it isn't rented out right away."
Higher rents are not great news for tenants. Jill Smith and her husband, Tim, moved out of their Springs of Palma Sola apartment in Bradenton after being notified of a $100 monthly increase in June. They leased a larger, but less expensive unit at nearby Vista at Palma Sola.
The former Michigan residents are renting until they're ready to buy a home. Jill Smith said the comparatively high cost of Florida's apartment market was a shock.
"I didn't think it was going to be so expensive," she said.
Demand for rentals has driven vacancies to about 3 percent in both counties. New apartment units are filling almost as quickly as they are built. At the 179-unit Riversong Apartments in Bradenton, about 75 percent of the units are occupied just 11 months after the complex opened.
Nichole Post, the property's manager, said the brisk rental market has allowed the complex to up its rental rates. On opening day, a one-bedroom apartment at Riversong rented for $975 a month. Today, a new renter coming into the building looking for that same unit will spend at least $1,279 a month. Two-bedroom units go for more, $1,699 a month.
"It's because we're brand new," Post said.
Still, she said, tenants willing to pay this level of rent continue to move in.
Most of the new apartments under construction are in downtown areas or East Manatee communities, places that generally attract middle- and upper-middle income renters. A lack of affordable units inspired a group of millennial professionals to begin working with Manatee County officials this year to seek apartment developers willing to build affordable rental housing.
The National Low Income Housing Coalition recently determined that the average fair market rent for a two-bedroom apartment in Manatee and Sarasota counties is $1,011. That means a family has to earn at least $40,440 to afford housing if they spend 30 percent of their income on rent as recommended by local, state and federal housing agencies.
Even though he raised the rent on his units by about $100 per month this year, McClash said he wants his rentals to remain affordable. But if rents continue to rise over the next couple of years, he said the number of properties like his will be inadequate to meet the needs of people working in the service industries.
Matt M. Johnson, Herald business reporter, can be reached at 941-745-7027 or on Twitter@MattAtBradenton.
This story was originally published December 1, 2015 at 6:17 PM with the headline "Apartment rents boom in Bradenton, Sarasota markets ."