Thursday, December 1 2022

The recent rapid increase in housing costs – whether to buy or rent – has stressed many current and potential residents of Wilton Manors.

As a result, living in the island city is no longer an affordable option for many who work here or wish to relocate.

Chart 1 shows the median prices (half sales above and half below) for the purchase of a single-family home, townhouse and condo at Wilton Manors in the fourth quarter of each of the last four years. Also included are median rents for one-bedroom and two-bedroom apartments (all MLS data).

Chart 1.

Rents were relatively stable from 2018 to 2020, but recently jumped significantly – 24% in one year for a one-bedroom apartment and 59% for a two-bedroom.

The rise in prices for houses, townhouses and condos is perhaps not so surprising, as has been widely noted here and elsewhere. Compared to just two years ago, the median single-family home price is up 31%. The middle townhouse has increased by 42% and the price for the middle condo has increased by 39%.

A household is considered “housing stressed” if its housing cost exceeds 30% of gross income, and “extremely stressed housing” if its housing cost exceeds 50% of income. Given that the median one-bedroom apartment at Wilton Manors rents for $1,550/month, a tenant in this unit would be stressed with a household income of less than $62,000 per year and extremely stressed with a lower annual income at $37,200.

The situation is amplified when looking at two bedroom rentals in the Island City. With a median rent of $2,550/month, this household would be stressed with an annual income of less than $102,000 and extremely stressed with an income of less than $61,200 per year.

Reliable information on recent buyer demographics is difficult to obtain. But to buy the median condo, townhouse or single-family home at Wilton Manors, assuming a 20% down payment and allowances for property taxes and insurance, would generally require the buyer(s) to have an annual income of at least $60,000, $120,000 and $170,000, respectively.

While many purchases are likely to be made with cash or higher than standard down payments, the US Census reports that the median household in Broward County has an annual income of around $60,000.

“Rapidly rising real estate costs are definitely impacting affordability for South Florida residents,” according to Wilton Manors Vice Mayor Paul Rolli, who noted that the state and county have affordable housing assistance programs. He added: “Wilton Manors is one of the few towns to have its own Affordable Housing Impact Tax. Funds from this have recently supported the construction of low-cost rental housing and several grants for low-income first-time home buyers.

Still, with prices soaring over the past few years (and this past year in particular), many people can no longer afford to live at Wilton Manors. While no one has the divinely ordained right to live in the island town, the reality is that many people work in Wilton, and more businesses in town have workers who are stressed (or unable to live nearby of their work) who provide goods and services to many well-to-do holidaymakers and a wealthy local elite. This is also the case for destinations like Palm Springs, Rehoboth and Provincetown. Wilton Manors is now part of this mainstream.

Florida Real Estate Geek (SM) James Oaksun is a broker-owner of New Realty Concepts in Fort Lauderdale. In addition to having degrees from Dartmouth and Cornell, he is a graduate of the Realtor Institute (GRI).


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