Over 21% of Southwest Florida rentals are vacant

Published: August 19, 2022 5:29 PM EDT
Updated: August 19, 2022 6:30 PM EDT

A new study from Help Advisor says the rental vacancy rate in the Fort Myers area is 21.2%.

That’s the highest percentage of any city in the nation and it’s not a good thing if you’re a landlord.

This means for projects that are under construction right now could be in jeopardy depending on how far along those projects are.

As for anything new, developers have to take a look at the numbers and project where they believe the market is going.

Shelton Weeks, FGCU Director of the Lucas Institute for Real Estate Development and Finance said, “it’s just a reflection of what’s going on in the market, the number of units that are out there for rent that are currently available or unrented.”

Weeks said it’s simple economics, demand is falling and supply is rising.

“We’ve got a number of larger projects that are coming to market and bringing new units out there, it shouldn’t be surprising to find that the vacancy level has jumped in our market,” Weeks said.

David Dorsey, a Writer for Gulfshore Business said, if the rental vacancy rate remains high it will likely affect development.

“When those vacancy rates approach 15%, that’s kind of like the alarm to pump the brakes on development. Because when you get to double digits for vacancies, then all of a sudden, is it worth spending $50, $60, $80 million dollars to construct a 300-unit apartment complex,” Dorsey said.

If you’re looking for a place to live there are a lot of apartments in available Fort Myers.

“That’s going to put the landlords in a position of having to decide where is that optimal tradeoff between getting their units leased up, and being able to charge a market rate for it,” Weeks said.

If there are so many vacancies, why is rent so high?

“Now what we typically expect to see in a market where you have an unreasonably high number of vacancies are things such as free rent or maybe when you sign the lease, you get, you know, some sort of gift inducement to rent. We’re not seeing that in fort Myers,” Weeks said.

Dorsey said people are still moving here, even though rent isn’t coming down.

“That still indicates a high demand for multifamily. And high demand means higher prices and higher prices mean less affordable living for apartments,” Dorsey said.

Dorsey said developers look at rental vacancy numbers closely.

If the rental vacancy rate remains high they will probably wait to invest $40 to $60 million on a new apartment complex.