A lot has changed in the Miami rental property landscape over the last year. If you own or want to purchase rental property, don’t forget these 2022 cost increases in your rental property pro forma.
Increased Maintenance Costs
Shortages in raw materials has caused the cost of various supplies to increase dramatically. Paint prices have increased by roughly 15% since this time last year. An increase in gas prices have compounded the problem. As a result, vendors you will likely hire to prepare and maintain your rental property have increased their prices to cover the cost. When entering information in your rental property pro forma, don’t forget to account for the increase cost of maintenance.
Increased Insurance Costs
“Rampant roofing fraud, runaway litigation and rising replacement costs of homes,” are some of the factors of increased insurance costs said Mark Friedlander, an Insurance Information Institute (III) spokesman.
The III reported Florida premiums are up almost 25 percent in 2022, nearly double compared to the rest of the US.
Make sure to account for this increase in your rental property pro forma.
Related: What Education Do I Need to Become a Real Estate Investor?
Increased Competition
Although certain costs have increased, rental rates have as well. As a result, Miami has continued to be a desirable place to invest. Homeowners and investors are competing for limited inventory driving up prices. Good investment properties are harder to come by but not impossible to find. This is where your investment chops come into play. When you do find a property you deem to be a good investment, don’t forget to calculate for changes in the 2022 landscape.
Check back soon for our Wealth Optimizer tool. We will be able to help you identify quality investment properties in the Miami-Dade area. Happy renting!
Pedro Cedeño, Lic. Real Estate Agent, Real Property Management Dade – Miami, FL | My team and I are here to make it easy and profitable to own rental property in Miami by focusing on the people and not just the buildings. We love to see the positive effect good rental practices have on people. Sharing the knowledge we’ve gained over the years with current and aspiring landlords is part of our mission.