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In February 2022, Miami became the most expensive housing market in the county, according to a RealtyHop report.
Migration to Miami has tripled since the pandemic and it is the top migration destination in the US. Now that many people are working remotely, they are choosing to move to Miami for its lifestyle and tax benefits. Miami is undergoing a transformation as many tech and private equity companies are relocating or expanding their offices to South Florida. Consequently, home prices in Miami have soared due to demand from buyers and renters migrating from New York, California and Illinois. It is important to note that many of Miami’s new residents are moving from places that are significantly more expensive, and they find Miami prices affordable.
Based on the current median home price and median household income, a typical household would have to contribute 78.7% of its income towards homeownership costs, according to RealtyHop’s February affordability index.
Even though Miami has the dubious honor of least affordable city based on the index, in the report it was number 18 in regards to highest median price. This means that the median price for a home in Miami is relatively low compared to other major cities i.e. San Francisco, NYC, LA, Seattle, Scottsdale, etc. As a result, Miami is very attractive for people moving from out-of-state.
It’s only a matter of time before salaries increase and Miami residents require a smaller portion of their paycheck towards home payments. Many businesses are still in the process of relocating to Miami and will ultimately offer higher paying jobs, which will increase the median household income. For example, according to the US Bureau of Labor Statistics, wages and salaries in Miami increased at 6.0% per year compared to 5.0% nationwide for the 12-month period ended December 2021.
In a way, Miami is in the midst of a renaissance. Business are choosing to move here or expand their presence, and people want to live here, which is causing a housing shortage. At this time, there is no telling when the ferocity of the migration to Miami will subside. However, in the meantime, Miami is disproportionally gaining more jobs offering higher pay compared to other major cities.
New York was the second least affordable city in February with an index of 77.98% based on a projected median household income of $68,259 and median asking price of $970,000. Los Angeles was the third with an index of 74.2% based on a projected median household income of $68,733 and median listing price of $925,000.
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